ARCHIVES HISTORIQUES 
DE LA COMMISSION 
 
 
 
COLLECTION RELIEE DES 
DOCUMENTS "COM" 
 
 
 
 
COM (85) 310 
 
 
 
Vol. 1985/0130 
  
 
Disclaimer  
Conformém ent au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983 
concernant l'ouverture au public des archives historiques de la Communauté économique 
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983, 
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003 
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents 
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit 
règlem ent. 
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 
concerning the opening to the public of the historical archives of the European Economic 
Community and the European Atomic Energy Communit y (OJ L 43, 15.2.1983, p. 1), as 
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243, 
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this 
file have been declassified in conformity with Article 5 of the aforementioned regulation. 
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom  1. 
Februar 1983 über die Freigabe der historischen Archive der Europäischen 
Wirtschaftsgemeinschaft und der Europäischen Atomgem einschaft (ABI. L 43 vom  15.2.1983, 
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. Septem ber 2003 
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit 
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5 
der genannten Verordnung freigegeben. 
COMMISSION OF THE EUROPEAN COMMUNITIES
C0MC85) 310 final  
Brussels, 14 June 1985
COMPLETING THE INTERNAL MARKET
White Paper from the Commission  
to the European Council  
(Milan, 28-29 June 1985)
C0MC85) 310 final

CONTENTS
Declarations by the European Council  
relating to the Internal Market
INTRODUCTION
PART ONE :  THE REMOVAL OF PHYSICAL BARRIERS
I. Introduction
II. Control of goods
Commercial and economic policy
Health
Transport
Statistics
Conclusion and timetable
III. Control of individuals
PART TWO : THE REMOVAL OF TECHNICAL BARRIERS
I* Free movement of goods
The need for a new strategy  
The chosen strategy  
Harmonisation - a new approach  
Preventing creation of new obstacles  
Mutual recognition  
Nuclear materials
II. Public procurement
III. Free movement for labour and the professions :
a new initiative in favour of Community Citizens
IV. Common market for services
Traditional Services  
Financial services  
Transport
New technologies and services
V. Capital movements
VI. Creation of suitable conditions for  
industrial cooperation
Creation of a Legal framework facilitating  
cooperation between enterprises  
Intellectual and industrial property  
Taxation
VII. Application of Community law
Infringements
Transparency
Competition policy and state aids

-  2 -
PART THREE :  THE REMOVAL OF FISCAL BARRIERS 41
I. Introduction 41
Commercial Traffic and Value Added Tax 43
The Individual Traveller 44
Excises 45
II. Approximation 46
The Broad Picture 47
Value Added Tax .48
Excises 50
III. The Commission's proposals 51
Value Added Tax 51
Excises 53
Enforcement 53
Derogations 54
CONCLUSION 55
ANNEX :  Timetable for completing the  
Internal Market by 1992

- 3 ~
DECLARATIONS BT THE EUROPEAN COUNCIL  
RELATING TO THE INTERNAL KARKET
"The European Council... instructs the Council :
- to decide/, before the end of March 1983, on the priority  
measures proposed by the Commission to reinforce the  
internal market"
Copenhagen, 3/4 December 1982
"It asks the Council and the Member States to put in hand without  
delay a study of the measures which could be taken to bring about  
in the near future...
the abolition of all police and customs formalities for  
people crossing intra-Community frontiers..."
Fontainebleau, 25/26 June 1984
"The European Council... agreed that the Council, in its  
appropriate formations :
... should take steps to complete the Internal Market,  
including implementation of European standards"
Dublin, 3/4 December 1984
... the European Council laid  
following... fields of action :  
a) action to achieve a single  
creating a more favourable  
enterprise, competition and  
Commission to draw up a deta  
timetable before its next meeparticular emphasis cn the
large market by 1992 thereby  
environment for stimulating  
trade ' r it called upon the  
led programme with a specific  
ing".
Brussels, 29/30 March 1985

"Unifying this market (of 320 million) presupposes that Member  
States will agree on the abolition of barriers of all kinds,  
harmonisation of rules, approximation of legislation and tax  
structures, strengthening of monetary cooperation and the necessary  
flanking measures to encourage European firms to work together. It  
is a goal that is well within our reach provided we draw the  
lessons from the setbacks and delays of the past. The Commission  
will be asking the European Council to pledge itself to completion  
of a fully unified internal market by 1992 and to approve the  
necessary programme together with a realistic and binding  
timetable."
In such terms did the Commission define its task in the "Programme  
of the Commission for 1985®* which was presented to the European  
Parliament on 6 March. On 29 and 30 March, the European Council in  
Brussels broadly endorsed this view and
"laid particular emphasis on ... action to achieve a single 
market by 1992 thereby creating a more favourable environment  
for stimulating enterprise, competition and trade ; it called  
upon the Commission to draw up a detailed programme with a  
specific timetable before its next meeting'5.
This White Paper is designed to spell out the programme and  
timetable. Given the European Council's clear and repeated  
commitment to the completion of the common market, the Commission  
does not intend in this Paper to rehearse again the economic and  
political arguments that have so often led to that conclusion.  
Instead the Commission, which wholeheartedly shares the Council's  
commitment and objective, sets out here the essential and logical  
consequences of accepting that commitment, together with an action  
programme for achieving the objective.
The Treaty clearly envisaged from the outset the creation of a  
single integrated internal market free of restrictions on the  
movement of goods; the abolition of obstacles to the free movement  
of persons, services and capital; the institution of a system  
ensuring that competition in the common market is not distorted;  
the approximation of taws as required for the proper functioning of  
the common market; and the approximation of indirect taxation in  
the interest of the common market.
In the early days attention concentrated on the common customs  
tariff, which was established eighteen months ahead of the 12-year  
programme set out in the Treaty. It was a remarkable achievement -  
one that we can look back on with pride and one from which we can  
derive inspiration for the future. That task achieved, attention  
turned to indirect taxes. The high water mark was perhaps the  
adoption - unanimously by the Council - of the 6th VAT directive in  
1977. But thereafter momentum was lost partly through the onset of  
the recession, partly through a lack of confidence and vision.

- 5 -
6. The recession brought another problem. The Treaty specifically
required not simply the abolition of customs duties as between the  
Member States, but also the elimination of quantitative  
restrictions and of all measures having equivalent effect.  
Originally it was assumed that such "non-tariff barriers", as they  
are commonly called, were of limited importance compared with  
actual duties. But during the recession they multiplied as each  
Member State endeavoured to protect what it thought was its short  
term interests - not only against third countries but against  
fellow Member States as well. Member States also increasingly  
sought to protect national markets and industries through the use  
of public funds to aid and maintain non-viable companies. The  
provision in the EEC Treaty that restrictions on the freedom to  
provide services should "be progressively abolished during the  
transitional period" not only failed to be implemented during the  
transitional period, but over important areas failed to be
implemented at all. Disgracefully, that remains the case.
7. But the mood has begun to change, and the commitment to be
rediscovered :  gradually at first, but now with increasing tempo.
The Heads of State and Governments at the European Council meeting  
in Copenhagen in 1982 pledged themselves to the completion of the  
internal market as a high priority. The pledge was repeated at  
Fontainebleau in June 1984; at Dublin in December of that year;  
and, most recently, in Brussels, in March 1985. The time for talk  
has now passed. The time for action has come. That is what this  
White Paper is about.
8. The case for the completion of the internal market has been argued
elsewhere: and, as the communiqués at successive European Councils
have indicated, it has been accepted by the Heads of State and  
Governments of the Member States. But it is worth recalling that  
the objective of completing the internal market has three aspects :
- First, the welding together of the ten, soon to be twelve,  
individual markets of the Member States into one single market of  
320 million people ;
- Second, ensuring that this single market is also an expanding  
market - not static but growing ;
- Third, to this end, ensuring that the market is flexible so that  
resources, both of people and materials, and of capital and  
investment, flow into the areas of greatest economic advantage.
9. Whilst, therefore, the discussion in this Paper will be directed  
primarily to the first of these objectives there will be a need to  
keep the other two objectives constantly in mind and to ensure that  
the measures taken contribute to those ends.
10. For convenience the measures that need to be taken have been  
classified in this Paper under three headings :

-  6 -
- Part one :  the removal of physical barriers
- Part two :  the removal of technical barriers
- Part three :  the removal of fiscal barriers.
11. The most obvious example of the first category are customs posts at  
frontiers. Indeed most of our citizens would regard the frontier  
posts as the most visible example of the continued division of the  
Community and their removal as the clearest sign of the integration  
of the Community into a single market. Yet they continue to exist  
mainly because of the technical and fiscal divisions between Member  
States. Once we have removed those barriers, and found alternative  
ways of dealing with other relevant problems such as public  
security, immigration and drug controls, the reasons for the  
existence of the physical barriers will have been eliminated.
12. The reason for getting rid entirely of physical and other controls  
between Member States is not one of theology or appearance, but the 
hard practical fact that the maintenance of any internal frontier  
controls will perpetuate the costs and disadvantages of a divided  
market ; the more the need for such controls diminishes - short of  
total elimination - the more disproportionate become the costs,  
expenses and disadvantages of maintaining the frontiers and a  
divided market.
13. While the elimination of physical barriers provides benefits for  
traders, particularly through the disappearance of formalities and  
of frontier delays, it is through the elimination of technical  
barriers that the Community will give the large market its economic  
and industrial dimension by enabling industries to make economies  
of scale and therefore to become more competitive. An example of  
this second category - technical barriers - are the different  
standards for individual products adopted in different Member  
States for health or safety reasons, or for environmental or  
consumer protection. Here the Commission has recently launched a  
major new initiative which has been welcomed and endorsed by the  
Council. The barriers to the freedom to provide services could  
perhaps be regarded as a separate category; but these barriers are  
analogous to the technical barriers which obstruct the free  
movement of goods, and they are probably best regarded as part of  
the same category. There is an additional merit in such an approach  
since the traditional dichotomy between "goods" and "services" has  
fostered an attitude in which "services" are somehow regarded as  
inferior and relegated to the bottom of the queue. Technical  
barriers are technical barriers whether they apply to goods or  
services and all should be treated on an equal footing. The  
general thrust of the Commission's approach in this area will be to  
move away from the concept of harmonisation towards that of mutual  
recognition and equivalence. But there will be a continuing role  
for the approximation of Member States' laws and regulations, as  
laid down in Article 100 of the Treaty. Clearly, action under  
this Article would be quicker and more effective if the Council

- 7 -
were to agree not to allow the unanimity requirement to obstruct  
progress where it could otherwise be made.
14. The removal of fiscal barriers may well be contentious and this
despite the fact that the goals laid down in the Treaty are quite
explicit and that important steps have already been taken along the  
road of approximation. This being so, the reasons why
approximation of fiscal legislation is an essential and integral  
element in any programme for completing the internal market are  
explained in detail in Part Three of this Paper. Approximation
of indirect taxation will raise severe problems for some Member  
States. It may, therefore, be necessary to provide for derogations*
15. We recognise that many of the changes we propose will present
considerable difficulties for Member States and time will be needed  
for the necessary adjustments to be made.The benefits to an  
integrated Community economy of the large, expanding and flexible  
market are so great that they should not be denied to its citizens  
because of difficulties faced by individual Member States. These  
difficulties must be recognised, to some degree they must be  
accommodated, but they should not be allowed permanently to  
frustrate the achievement of the greater progress, the greater  
prosperity and the higher level of employment that economic
integration can bring to the Community.
(1 )16. Last year, the Commission submitted a Consolidation Programme
identifying a series of proposals to be adopted by the Council in  
1984 and 1985. This White Paper pursues this effort in a wider  
perspective and with a view to completing the Internal Market by  
1992. It therefore comprises the essential items of last year's  
paper without expressly repeating the Consolidation Programme which  
stilt remains valid.
17. This White Paper is not intended to cover every possible issue
which affects the integration of the economies of the Member States  
of the Community. It focusses on the Internal Market and the  
measures which are directly necessary to achieve a single  
integrated market embracing the 320m people of the enlarged
Community. There are many other matters - all of them important in
their own way - which bear upon economic integration, indirectly  
affect the achievement of the Internal Market and are the subject  
of other Community policies.
18. For example, it is a fact that in order to facilitate the key role  
which the internal market can play in the policy for the recovery  
of industrial structures, the suspension of internal borders must  
be accompanied by actions which strengthen research and the  
technological base of the Community's industry. Such actions will  
allow firms to benefit from the size of the single market. It is  
within this context that the present work of strengthening the  
Community's technological base should be seen.
C0MC84) 305 final of 13 June 1984.

-  8 -
19. Similarly, the strengthening of coordination of economic policies  
and the EMS will be essential factors in the integration of  
national markets. However, any action taken to ensure the free  
movement of factors of production must necessarily be accompanied  
by increased surveillance by the Commission in the field of  
competition rules to ensure that firms and Member States adhere to  
these rules. In particular, a strong and coherent competition  
policy must ensure that the partitioning of the internal market is  
not permitted to occur as a result of protectionist state aids or  
restrictive practices by firms. Moreover the commercial identity of  
the Community must be consolidated so that our trading partners  
will not be given the benefit of a wider market without themselves  
making similar concessions.
20. There are many other areas of Community policy that interact with  
the Internal market in that they both affect its workings and will  
benefit from the stimulus that will be provided by its completion.  
This is particularly true of transport, social, environment and  
consumer protection policy. As far as social aspects are concerned,  
the Commission will pursue the dialogue with governments and social  
partners to ensure that the opportunities afforded by completion of  
the Internal Market will be accompanied by appropriate measures  
aimed at fulfilling the Community's employment and social security  
objectives.
21. The Commission is firmly convinced that the completion of the  
Internal Market will provide an indispensable base for increasing  
the prosperity of the Community as a whole. The Commission is,  
however, conscious that there may be risks that, by increasing the  
possibilities for human, material and financial services to move  
without obstacle to the areas of greatest economic advantage,  
existing discrepancies between regions could be exacerbated and  
therefore the objective of convergence jeopardized. This means that  
full and imaginative use will need to be made of the resources  
available through the structural funds. The importance of the funds  
will therefore be enhanced.
22. Although this White Paper will touch on these matters where they  
have a direct bearing on the working of the Internal Market, it  
wilt not attempt to cover them in full and in detail as they  
represent considerable areas of study in their own right and merit  
separate and fuller consideration elsewhere. The existence of 
these problems does not mean that the frontiers and other frontier  
controls should not be abolished. On the contrary the task we face  
is to find solutions to the problems on the basis that the  
frontiers will have been abolished.
23. A detailed timetable for implementing the Commission's proposed  
programme of measures for the removal of physical, technical and  
fiscal barriers is to be found in the Annex to this Paper.

- 9 -
PART ONE :  THE REMOVAL OF PHYSICAL BARRIERS
I. INTRODUCTION
24. It is the physical barriers at the customs posts, the immigration  
controls, the passports, the occasional search of personal baggage,  
which to the ordinary citizen are the obvious manifestation of the  
continued division of the Community - not the "broader and deeper  
Community" envisaged by the original Treaties but a Community still  
divided. These barriers are equally important to trade and  
industry, commerce and business. They impose an unnecessary burden  
on industry flowing from the delays, formalities, transport and  
handling charges, thus adding to costs and damaging competi­
tiveness.
25. There is therefore a double reason for removing the physical  
barriers - an economic reason and a political reason. The setting  
up of the ad hoc Committee on a People's Europe at the  
Fontainebleau European Council (the Adonnino Committee) is ample  
testimony to the importance of the political concept. There is no  
area in which progress, where it can be made, would be more visible  
or more directly relevant to the aims, ambitions and vision of the  
Community.
26. Under the Treaty, customs duties and quantitative restrictions in
intra-Community trade have been abolished. Customs posts at  
internal frontiers have, however, continued to exist as a  
convenient point at which to check compliance with national  
indirect taxation rules. Use has also been made of this continued  
official presence to enforce national protective measures relating  
to for example terrorism, drugs, other prohibited goods and  
immigration. Measures adopted by the Community itself have led  
Member States to use internal frontier posts for controlling
aspects of common policies (agriculture and steel) and for applying  
safeguard clauses.
27. Our objective is not merely to simplify existing procedures, but to  
do away with internal frontier controls in their entirety. In some  
cases this will be achieved by removing the underlying causes which  
give rise to the controls. In others it will be a matter of finding  
ways and means other than controls at the internal frontiers to  
achieve comparable levels of protection and/or information.
28. Where the underlying causes consist partly of national policies and
partly of common policies which are not yet fully developed,
achieving our objective will require national policies either to be  
progressively relaxed and ultimately abandoned where they are no  
longer justified, or replaced by truly common policies applicable
to the Community as a whole. Community policies which are not yet
fully developed and at present give rise to internal frontier

-  10  -
controls will have to be amended so as to obviate the need for  
controls. It follows that once these barriers have been removed,  
the reasons for the existence of controls at internal frontiers  
will have been eliminated.
29. The Commission recognises, however, that certain national pro­
tective measures do not in all their aspects fall within the scope  
of the Treaty. Two very important examples are measures against  
terrorism and the illicit trade in drugs. The Commission shares the  
legitimate concerns of the Member States about the need to control  
drugs and terrorism and is well aware of the role of internal  
frontier posts in this respect. It needs to be stressed, however,  
that frontier controls are by no means the only or indeed the most  
effective measures in this regard. If the objective of abolishing  
all internal frontier controls is to be met, alternative means of  
protection will need to be found or, where they exist,  
strengthened. Obvious examples are improving controls at the  
external frontiers of the Community ; using spot-checks at the  
internal frontiers and inland and further enhancing cooperation  
between the national authorities concerned.
30é Internal frontier controls are made on both goods and individuals  
and are motivated by fiscal, commercial, economic, health,  
statistical and police considerations. Individuals and their  
personal property are usually checked by customs and police or 
immigration officials, and goods by customs and sometimes more  
specialised authorities.
31. The customs authorities' primary role at internal frontier posts -  
or within the Member State where formalities and checks take place  
inland - is to ensure that the indirect taxation system of the  
Member State in question (VAT, excise duties) continues to operate.  
It therefore follows that, from the customs viewpoint, the problem  
of removing physical controls is largely related to that of  
removing fiscal barriers. This latter problem is dealt with in  
detail in Part Three of this Paper.
32. The considerations which apply to goods and individuals are very  
different. We therefore examine them separately.
II. CONTROL OF 800BS
33. To date Community action has concentrated on alleviating internal  
frontier formalities and facilitating the movement of goods. To
this end and in accordance with Articles 12, 30 and 95 of the EEC-
Treaty, the Commission has ensured and will continue to ensure that
the customs authorities observe the principles of non­
discrimination and proportionality. The Community transit procedure  
and the single administrative document are concrete examples of the  
achievements reached by means of Community legislation ; they can  
and should be improved further in the medium term (for example by  
renouncing the Community transit guarantee). Where appropriate,  
there should be increased use of electronic data transmission

-  11  -
systems, on the basis of common standards. In addition, the
implementation of the fourteenth VAT directive would greatly  
simplify internal frontier formalities by shifting the collection  
of VAT to inland tax offices ; but it will not in itself eliminate  
the need for customs checks at frontiers either on entry into the  
importing country or, with greater reason, from the exporting  
country in order to provide proof of actual export.
34. In order to provide a suitable foundation for further progress, the  
Commission will at an early stage seek a commitment from the Member  
States that no new or more stringent controls or formalities  
relating to goods are introduced. With cooperation between Member  
States, further simplification at internal frontiers might be  
achieved by avoiding duplication of controls on both sides of the  
frontier (so-called "banalisation"). For example, it might be  
possible for the exporting Member State to obtain proof of actual  
export of goods or statistical data on exports from the customs  
office of entry in the importing Member State importation. But the  
fact remains that to shift from the alleviation to the elimination  
of internal frontier controls requires a major and qualitatively  
different approach. To do this we need to find ways of abolishing  
the barriers which give rise to the need for the different controls  
imposed on goods.
Commercial and economic policy
35. Commercial policy measures affecting Member States individually
(residual import quotas maintained by some Member States > import  
measures taken by the Community but limited to one or several
Member States only ; individual import quotas for Member States as  
part of a Community-wide measure or of an agreement coordinated by  
the Community) may lead the Commission on the basis of Article 115  
of the EEC Treaty to authorise a Member State to exclude the
product under protection from free movement within the territory  
of the Community. National measures stemming from authorisation by  
the Commission necessarily involve formalities at internal  
frontiers. It is worth noting that it is the absence of or failure  
to apply a common policy which give rise to such action. It follows  
that, until the powers transferred by the Treaty to the Community  
are fully exercised and the common commercial policy has been  
strengthened in such a way that all national protection measures  
and all regional quotas set»·.up by the Community can be abolished,  
there will be a continuing need for some form of control. The  
Commission takes the view that it is not an unreasonable aim to  
achieve this abolition of national and regional quotas by 1992.
Nevertheless we recognise that there may well be considerable
problems to be overcome.
36. If Article 115 were no longer to be applicable, any import  
restrictions would have' to be applied on a Community-wide basis.  
The enforcement of such quotas, which relies to a large extent on  
the administrations of Member States, would require intensive  
cooperation between national administrations and the Commission.  
Should it prove impossible to eliminate all individual quotas for

Member States by 1992, internal frontier controls could no longer  
be the instrument of their application. Alternative ways of  
applying quotas would need to be found.
The case is different for the use of clauses to cope with  
imbalances giving rise to serious threat of balance-of-payments  
difficulties. It is not possible realistically to set out a precise  
timetable for progressive restriction of the use of Article 108, in  
view of the direct link between this Article and economic  
situations of individual Member States. But if the aim of  
eliminating internal frontier controls by 1992 is to be achieved,  
measures applicable at internal frontiers will need to be renounced  
by then.
Certain mechanisms applying to trade in agricultural products also  
require controls at internal frontiers. For example, monetary  
compensatory amounts are applied to trade in certain commodities on  
export and import ; countervailing charges under Article 46 can be  
applied to trade in commodities where no common organisation has  
yet been agreed ; certain taxes and other mechanisms can be needed  
in other commodity sectors. Clearly these requirements must be  
abolished through the development of the relevant parts of the  
Common Agricultural Policy. It would further require the automatic  
adjustment of agricultural prices in the case of monetary  
realignment, preferably within the EMS ; the setting-up of common  
organisations for agricultural products not so far covered, with  
the aim of removing the possibility of recourse to Article 46 ; and  
adaptation of other market organisations. Trade in steel too is  
subject to additional controls stemming from the Common Steel  
Policy and environmental policy (control of transport of dangerous  
and toxic wastes). Steps will also have to be taken to cope with  
the consequences for these policies of the elimination of internal  
frontier formalities.
Health
As regards health protection, the internal frontier posts are often  
used for making veterinary and plant health checks. These controls  
stem from differences in national public health standards, which  
give national authorities grounds for checking that imported  
products conform to national requirements. The Community has,  
therefore, set out to implement a programme for the harmonisation  
of essential health requirements, a technically complex and  
procedurally slow process. But even where there is harmonisation,  
internal frontier controls have not always been eliminated because  
Member States still insist on carrying out their own checks. Some  
steps have been taken to transfer inland the checks on veterinary  
and plant health certificates. But there are gaps in these  
measures: their general adoption will depend upon mutual acceptance  
by Member States that the checks on goods have been properly  
applied by the exporting State.
As a further early step towards the objective of abolishing  
internal frontier controls by 1992, all veterinary controls (live

- 13 -
animats and animal products) and plant health controls will have to  
be limited to the places of departure, and controls of veterinary  
and plant health certificates made at the places of destination  
(together with control of products if there are reasons to assume  
fraudulent or negligent practices).
41. To facilitate this, more common standards will have to be esta­
blished for trade between Member States and for imports from third  
countries for those live animals and animal products where they are  
still lacking. Animal products conforming to these standards would  
receive a Community mark. In addition supervising authorities in  
the country of origin would have to check goods for consumption in  
other Community countries, in accordance with coordinated  
procedures. Mutual trust would be enhanced by the appointment of  
Community inspectors to check that controls were being correctly  
carried out. Furthermore, Member States should cooperate in  
fighting fraudulent practices in the Community framework, and rules  
of liability in cases of damage resulting from fraudulent or  
negligent practices would need to be established.
42. Certain import restrictions and quarantine measures would still be  
justified on grounds of protection of plant and animal health, in  
line with common standards. In order to harmonise as far as  
possible such restrictions, common policies designed to fight  
disease would have to be strengthened.
43. In order to meet the objective of 1992, a major effort at Community  
and at Member States level will be needed to achieve common levels  
and policies for veterinary and plant health and to align national  
standards to common standards as much as possible. To the extent  
that this can be achieved, the role of the veterinary and phyto-  
sanitary certificate could be drastically reduced and specific  
restrictions only needed for disease emergencies. For animal  
products, use of the health mark would be sufficient.
Transport
44. Other internal frontier controls are aimed at the carriage of goods  
and have to do either with the administration of transport policy  
or with safety requirements. Most intra-Community transport ope­
rations are subject to quotas, for which vehicles must carry  
transport authorisations. The authorisations and the books of  
record sheets are mostly checked at the frontier. If these controls  
are to be abolished, the transport quotas themselves must be  
progressively relaxed and abolished. Goods - particularly dangerous  
products - may also be checked for safety reasons. Moreover,  
vehicles are increasingly being checked at the frontier for  
compliance with national requirements ; this is particularly true  
in the case of motor coaches. Systematic safety controls at  
internal frontiers will need to be eliminated. Road vehicles which  
enter a Member State would however remain liable to check under the  
same conditions as apply nationally to road vehicles. The adoption  
and proper enforcement of common safety standards would greatly  
facilitate this process.

- 14 -
Statistics
45. Systematic formalities are carried out for statistical purposes ;
the statistics are required not only by the Member States but also  
by the Community. The introduction of the single administrative  
document will initially simplify frontier formalities, but
additional harmonisation or elimination will be needed if the
different statistical data are to be presented in a uniform way by  
1992. Furthermore, statistical data will have to be collected not  
on the basis of documents accompanying goods, but from firms in the  
way that statistics on internal activities are collected at
present. Modern methods of data collection, including sampling
techniques, will help to ensure that accurate and comprehensive  
trade statistics can be compiled.
Conclusion and timetable
46. Given the technical complexities of the measures to be adopted and
the major legislative task which will fall to Community
institutions, the Commission intends that this work should be  
planned in two stages. In the first stage, the emphasis should be  
to shift, where possible by 1988, controls and formalities away  
from the internal frontiers. In the second stage, the aim would be  
to coordinate policies and approximate legislation so that the  
internal frontier barriers and controls are eliminated in their  
entirety by 1992.
III. CONTROL OF INDIVIDUALS
47. The formalities affecting individual travellers are a constant and .  
concrete reminder to the ordinary citizen that the construction of
a real European Community is far from complete.
48. Even though these controls are often no more than spot checks, they  
are seen as the outward sign of an arbitrary administrative power  
over individuals and as an affront to the principle of freedom of  
movement within a single Community.
49. This prompted the Fontainebleau European Council to give the
Adonnino Committee the task of examining the measures to be taken  
to bring about "the abolition of all police and customs formalities  
for people crossing intra-Community borders”.  The Committee thought  
this aspect to be so important that it presented an interim report  
in March of this year.
50. The formalities in question are, in normal circumstances, of two
different kinds :  police checks relating to the identity of the
person concerned and the safety of personal effects being carried^  
and tax checks relating to personal effects being carried. We
concentrate here on the police checks. The removal of fiscal  
barriers and controls is covered in Part Three.

- 15 -
51. The Commission's efforts and initiatives in this area have been  
aimed at making checks at internal frontiers more flexible, as they  
cannot be abolished altogether until, in line with the concerns  
expressed by the European Council, adequate safeguards are  
introduced against terrorism and drugs.
52. Agreement has already been reached on the Commission's proposal for  
a common passport testifying to the individual's position as a  
citizen of a Member State. As an additional step towards abolition  
of physical controls the Commission has proposed the introduction  
of a means of self-identification which would enable the autho­
rities to see at a glance that the individual is entitled to free  
passage - the Green Disc. This proposal is at present before the  
Council and should be adopted forthwith.
53. As noted in the introduction to this Part, police checks at in­
ternal frontiers are bound up with the legitimate concerns of the  
political authorities in the fight against terrorism, drugs and  
crime. Consequently, they can only be abolished as part of a  
legislative and administrative process whereby they are transferred  
to the strengthened external frontiers of the Community and  
cooperation between the relevant national authorities is further  
enhanced.
54. The Commission will at an early stage seek a commitment from the  
Member States that no new or more stringent controls or formalities  
affecting individuals are introduced at inernal frontiers. The  
Commission will as a next step be proposing measures to eliminate  
completely by 1988 checks on leaving one Member State when entering  
another. This type of check has already been virtually abolished  
in practice at internal frontier crossings by road. This step  
would entail administrative cooperation between the police  
authorities and the information transmission networks to enable the 
police in the country of entry to carry out checks an behalf of the  
police in the country of departure. A system of this kind would  
provide continuing protection in the combat against terrorism.  
Moreover, such a system would not preclude security - as opposed to  
identity - checks being carried out in airports.
55. By 1992, the Commission wishes to arrive at the stage whereby  
checks on entry are also abolished for Community citizens arriving  
from another Community country. To this end, directives will be  
proposed concerning:
The approximation of arms legislation; the absence of checks  
must not provide an incentive to buy arms in countries with 
less strict legislation. A proposal will be made in 1985  
with the target of approval in 1988 at the latest;
The approximation of drugs legislation: proposals will be
made in 1987, for adoption in 1989 ;
Non-Community citizens: the abolition of checks at internal
frontiers will make it much easier for nationals of non-

- 16 -
Community countries to move from Member State to another. As  
a first step*, the Commission will propose in 1988 at the  
latest coordination of the rules on residence, entry and  
access to employment, applicable to nationals of non-  
Community countries. In this regard problems may arise over  
the question of the change of residence of non-Community  
citizens between the Member States, and these will need to be  
looked at. 'Measures will be proposed also in 1988 at the  
latest on the right of asylum and the position of refugees.  
Decisions will be needed on these matters by 1990 at the  
latest^
Visa policy: the freedom of movement for non-Community
nationals, which visas provide, may undermine the agreements  
which Member States have with non-member countries. It will  
therefore be necessary to go further than the existing  
collaboration in the context of political cooperation and  
develop a Community policy on visas. This would need to  
strike the right balance between national foreign policy  
prerogatives and preserving the effectiveness of existing  
bilateral agreements.· The requisite proposals should be made  
in 1988 for adoption by 1990. There will also be a need to  
fix common rules concerning extradition policy,. The  
necessary proposal, to be made in 1989, should be adopted by  
1991.
56. The adoption of these measures by the Council, accompanied by a  
redeployment of resources to strengthen controls at the external  
frontiers, and enhanced cooperation between police and other  
relevant agencies within the Member States, should enable police  
checks at internal frontiers to be eliminated by 1992.

- 17 -
PART TWO : THE REMOVAL OF TECHNICAL BARRIERS
57. The elimination of border controls, important as it is, does not  
of itself create a genuine common market. Goods and people moving  
within the Community should not find obstacles inside the dif­
ferent Member States as opposed to meeting them at the border.
58. This does not mean that there should be the same rules everywhere,
but that goods as well as citizens and companies should be able to  
move freely within the Community. Subject to certain important  
constraints (see paragraph 65 below), the general principle should  
be approved that, if a product is lawfully manufactured and
marketed in one Member State, there is no reason why it should not  
be sold freely throughout the Community. Indeed, the objectives of  
national legislation, such as the protection of human health and  
life and of the environment, are more often than not identical. It  
follows that the rules and controls developed to achieve those  
objectives, although they may take different forms, essentially  
come down to the same thing, and so should normally be accorded  
recognition in all Member States, not forgetting the possibilities  
of cooperation between national authorities. What is true for  
goods, is also true for services and for people. If a Community  
citizen or a company meets the requirements for its activity in one 
member State, there should be no valid reason why those citizens or  
companies should not exercise their economic activities also in  
other parts of the Community.
59. The Commission is fully aware that this strategy implies a change  
in habits and in traditional ways of thinking. What is needed is a  
radical change of attitude which would lead to new and innovative  
solutions for problems - real or apparent - which may appear when  
border controls no longer exist.
I. FREE MOVEMENT OF GOODS
60. Whilst the physical barriers dealt with in Part One impede trade  
flows and add unacceptable administrative costs (ultimately paid by  
the consumer), barriers created by different national product  
regulations and standards have a double-edged effect: they not only  
add extra costs, but they also distort production patterns;increase  
unit costs; increase stock holding costs; discourage business  
cooperation, and fundamentally frustrate the creation of a common  
market for industrial products. Until such barriers are removed,  
Community manufacturers are forced to focus on national rather than  
continental markets and are unable to benefit from the economies of  
scale which a truly unified internal market offers. Failure to  
achieve a genuine industrial common market becomes increasingly  
serious since the research, development and commercialisation costs  
of the new technologies, in order to have a realistic prospect of

being internationally competitive, require the background of a home  
market of continental proportions.
The need for a new strategy
The harmonisation approach has been the cornerstone of Community  
action in the first 25 years and has produced unprecedented  
progress in the creation of common rules on a Community-wide basis.  
However, over the years, a number of shortcomings have been  
identified and it is clear that a genuine common market cannot be  
realised by 1992 if the Community relies exclusively on Article 100  
of the EEC Treaty. There will certainly be a continuing need for  
action under Article 100; but its rote will be reduced as new  
approaches, resulting in quicker and less troublesome progress, are  
agreed. At least, as far as veterinary and phytosanitary controls  
are concerned,Article 43 makes possible qualified majority voting :  
the Council however has regularly used Article 100, which requires  
unanimity, as an additional legal base. The Commission does not  
think this position is justified. Where Article 100 is still  
considered the only appropriate instrument, ways of making it  
operate more flexibly will need#to be found. Clearly, action under  
this Article would be quicker and more effective if the Council  
were to agree not to allow the unanimity requirement to obstruct  
progress where it could otherwise be made.
The new strategy must be coherent in that it will need not merely  
to take into account the objective of realizing a common market per  
se, but also to serve the further objectives of building an  
expanding market and a flexible market. It must aim not simply to  
remove technical barriers to trade, but to do so in a manner which  
will contribute to increasing industrial efficiency and  
competitiveness, leading to greater wealth and job creation.
In principle, therefore, given the Council's recognition
(Conclusions on Standardization, 16 July 1984) of the essential  
equivalence of the objectives of national legislation, mutual  
recognition could be an effective strategy for bringing about a  
common market in a trading sense. This strategy is supported in  
particular by Articles 30 to 36 of the EEC Treaty, which prohibit  
national measures which would have excessively and unjustifiably  
restrictive effects on free movement.
But while a strategy based purely on mutual recognition would  
remove barriers to trade and lead to the creation of a genuine  
common trading market, it might well prove inadequate for the  
purposes of the building up of an expanding market based on the  
competitiveness which a continental-scale uniform market can  
generate. On the other hand experience has shown that the  
alternative of relying on a strategy based totally on harmonization  
would be over-regulatory, would take a long time to implement,  
would be inflexible and could stifle innovation. What is needed is  
a strategy that combines the best of both approaches but, above  
all, allows for progress to be made more quickly than in the past.

- 19 -
The chosen strategy
65. The Commission takes into account the underlying reasons for the
existence of barriers to trade, and recognises the essential
equivalence of Member States' legislative objectives in the  
protection of health and safety, and of the environment. Its  
harmonization approach is based on the following principles :
- a clear distinction needs to be drawn in future internal market  
initiatives between what it is essential to harmonize, and what  
may be left to mutual recognition of national regulations and  
standards ; this implies that, on the occasion of each  
harmonisation initiative, the Commission will determine whether  
national regulations are excessive in relation to the mandatory  
requirements pursued and, thus, constitute unjustified barriers  
to trade according to Article 30 to 36 of the EEC Treaty ·,
- legislative harmonisation (Council Directives based on Article  
100) will in future be restricted to laying down essential health  
and safety requirements which will be obligatory in all Member  
States. Conformity with this will entitle a product to free  
movement ;
- harmonisation of industrial standards by the elaboration of  
European standards will be promoted to the maximum extent, but  
the absence of European Standards should not be allowed to be  
used as a barrier to free movement. During the waiting period  
while European Standards are being developed, the mutual  
acceptance of national standards, with agreed procedures, should  
be the guiding principle.
66. The creation of the internal market relies in the first place on
the willingness of Member States to respect the principle of free  
movement of goods as laid down in the Treaty. This principle allows  
the Commission to require the removal of all unjustified barriers  
to trade. But it is not sufficient when barriers are justified  
under the Treaty. Similarly, there will be cases where the intro­
duction of common standards, particularly in the high technology  
sectors, will encourage and increase the international
competitivity of Community industries.
Harmonisation - a new approach
67. Article 100 of the Treaty empowers the Council, acting unanimously  
on a proposal from the Commission, to legislate by Directive for  
the approximation of the laws, regulations and administrative  
actions of Member States which directly affect the establishment or  
the functioning of the common market. However, a number of  
shortcomings have been recognized in the procedures established for  
the implementation of Article 100.
68. The practice of incorporating detailed technical specifications in  
Directives has given rise to long delays because of the unanimity  
required in Council decision making. Henceforth, in those sectors

-  20  -
where barriers to trade are created by justified divergent national  
regulations concerning the health and safety of citizens and  
consumer and environmental protection, legislative harmonization  
will be confined to laying down the essential requirements, con­
formity with which will entitle a product to free movement within  
the Community. The task of defining the technical specifications of  
products which will be deemed to conform to legislated  
requirements, will be entrusted to European Standards issued by the  
Comité Européen de la Normalisation (CEN) or by sectoral European  
Standards in the electrical and building sectors such as CENELEC,  
UEAtc or RILEM, acting on qualified majority votes.
The Commission is taking steps to strengthen the capacity of these  
European Standards bodies and also, in the telecommunications  
sector, of CEPT. This is seen not only as a necessary adjunct to  
the "new approach", but as an essential ingredient in the gradual  
replacement of national standards by European Standards in all  
areas.
The Council generally should off-load technical matters by making  
more use of its powers of delegation as recommended by the European  
Council. Article 155 of the EEC Treaty makes express provision for  
this possibility and opens the way to a simplified legislative  
procedure. This procedure has already been used successfully in  
customs matters and with the adaptation of existing directives to  
technical progress. The encouraging results suggest that this  
procedure should be extended.
This general policy will put particular emphasis on certain  
sectors :  these include information technology and
telecommunications, construction and foodstuffs.
- in the information technology and telecommunications sector, the  
Commission wants to establish specific rules which take account  
of the requirement for much greater precision and more rapid  
decision-making so as to ensure compatibility, intercom­
munication and interworking between the users and operators  
throughout the Community. This sector is usually the  
responsibility of public authorities and particularly the PTT'S.  
In this context it is important that this task be undertaken as  
much as possible on a common basis, and that the resulting  
specifications (and corresponding tasks and certification  
procedures) be mutually recognised from the start. Recent  
Commission proposals as well as the agreement concluded in July  
1984 with CEPT have been in keeping with this tendency;
- because of the existence of a wide range of products in the field  
of construction, the Commission will proceed to establish  
European codes concerning buildings in such a way as to ensure  
compatibility between components and the structures in which they  
will be used. The Commission considers that such action will of  
itself contribute to deregulation efforts;

-  21 -
in the foodstuffs sector, Community Legislative action has been 
concentrated, and will continue to be concentrated, on issuing 
"horizontal" directives governing the use of food additives, 
labelling regulations etc., where the essential need to protect 
the health and safety of consumers is involved. In line with the 
"new approach", and in line with the recommendations of the Dooge 
Committee, the Commission will propose more efficient procedures 
for the implementation of Article 100 harmonisation in this 
sector. This approach will be based on the principle of 
delegating to the Commission, advised by the Scientific Committee 
for Food, the task of drawing up and managing the more detailed 
and technical aspects of these directives, leaving the Council 
free to concentrate on the essential safety and health criteria 
which must be observed. To this end, the Commission will submit a 
communication to the Council and to the European Parliament 
before the end of 1985, and it will propose the extension of 
Directive 83/189/EEC to the food sector.
72. The Commission considers it essential that in all programmes
designed to achieve a unified internal market, the interests of all 
sections likely to be affected e.g. both sides of industry,
commerce and consumers, are taken into account. It further 
considers that such interests should be incorporated in the policy 
on the health and safety of workers and consumers. That is why 
arrangements have been made to ensure the participation of consumer 
representative bodies in the work of CEN and CENELEC ; and the 
Commission, with the assistance of the Consultative Consumers 
Committee, will take further steps to ensure that consumer
interests are consulted.
73. Moreover, the Commission will review all pending proposals in order 
to withdraw such proposals as are considered to be non-essential or 
which are not in line with the new strategy.
Preventing creation of new obstacles
74. Experience shows that a State's membership of the Community is not 
always sufficiently reflected in the attitudes and outlook of its 
administrations. When Member State Governments deem new acts or 
regulations to be necessary for national purposes, they do not 
always or automatically, in drafting their national instruments, 
take account of the Community dimension or of the need to minimise 
the difficulties for relations between Member States. Opportunities 
are thus lost for making simple and inexpensive improvements.
75. In order to prevent the erection of new barriers. Directive 
83/189/EEC now obliges Member States to notify the Commission in 
advance of all draft regulations and standards concerning technical 
specifications that they intend to introduce on their own 
territory. A standstill on adoption must then be instituted by the 
notifying Member State, during which the draft can be considered by 
the Commission and the other Member States in order to determine 
whether it contains any elements likely to create barriers to trade 
and, if so, to start remedial action under Articles 30 or 100.

-  22 -
This new "information" procedure which came fully into force on
1.1.1985, constitutes a major step forward and has already been 
successful in pre-empting a number of potential obstacles to the 
free movement of goods between Member States. It is necessary 
therefore that this procedure, which does not yet cover all 
industrial products, be extended to cover for example the food and 
pharmaceutical sectors. In the field of environmental protection a 
comparable improvement could easily be achieved by making 
obligatory the gentleman's agreement on notification which has 
existed since 1973.
Mutual recognition
Following the rulings of the Court of Justice, both the European 
Parliament and the Dooge Committee have stressed the principle that 
goods lawfully manufactured and marketed in one Member State must 
be allowed free entry into other Member States. In cases where 
harmonisation of regulations and standards is not considered 
essential from either a health/safety or an industrial point of 
view, immediate and full recognition of differing quality 
standards, food composition rules, etc. must be the rule. In par­
ticular, sales bans cannot be based on the sole argument that an 
imported product has been manufactured according to specifications 
which differ from those used in the importing country. There is no 
obligation on the buyer to prove the equivalence of a product 
produced according to the rules of the exporting State. Similarly, 
he must not be required to submit such a product to additional 
technical tests nor to certification procedures in the importing 
State. Any purchaser, be he wholesaler, retailer or the final 
consumer, should have the right to choose his supplier in any part 
of the Community without restriction. The Commission will use all 
the powers available under the Treaty, particularly Articles 30-36, 
to reinforce this principle of mutual recognition.
In the specific area of testing and certification procedures, a 
major initiative will soon be launched to bring about within the 
Community mutual recognition of tests and certification so as to 
avoid the wasteful duplication of tests which in some sectors is 
the rule rather than the exception. This initiative will involve 
the drawing up of common conditions and codes of practice for 
implementation by Laboratories and certification bodies. These 
codes will be based on existing codes of Good Laboratory Practice 
and Good Manufacturing Practice which are already in wide use.
The net long term effect of adopting and implementing this new 
strategy will be to reduce the regulatory burden on enterprises 
whishing to operate on a Community wide basis. In those (henceforth 
more limited) areas where harmonisation of regulations will still 
be required, enterprises will only have to meet a single set of 
harmonised rules rather than 10 or 12 different sets in order for 
their products to enjoy free circulation throughout the Community. 
Similarly the application of the new approach to standardisation 
and the move towards the principle of mutual recognition in an 
increasing number of other areas will speed up the decision-making

-  23 -
process and avoid the need for a further layer of Community rules 
to be super-imposed on national rules.
Muclear materials
80. Because of the special nature of nuclear material, transfers of 
such material between Member States are subject to specific 
conditions. In November 1984, the Commission proposed a revision of 
Chapter VI of the Euratom Treaty. Inter alia, this proposal would 
ensure both the unity of the internal nuclear market and the 
validity of such conditions under Community law.
II. PUBLIC PROCUREMENT
81. Public procurement covers a sizeable part of GDP and is still 
marked by the tendency of the authorities concerned to keep their 
purchases and contracts within their own country. This continued 
partitioning of individual national markets is one of the most 
evident barriers to the achievement of a real internal market.
82. The basic rule, contained in Article 30 et seq. of the EEC Treaty, 
that goods should move freely in the common market, without being 
subject to quantitative restrictions between Member States and of 
all measures having equivalent effect, fully applies to the supply 
of goods to public purchasing bodies, as do the basic provisions of 
Article 59 et seq. in order to ensure the freedom to provide 
services. Specific provisions seeking to terminate discriminatory 
practices in the supply of goods were laid down in Directive 
70/32/EEC, whilst Directive 77/62/EEC intends to open the awarding 
procedures to Communitywide competition. Equally, as far as 
public works contracts are concerned. Directive 71/305/EEC 
coordinates the awarding procedures in order to make the awarding 
process transparent to potential bidders in the whole of the 
Community. Directive 71/3Q4/EEC concerns the freedom to provide 
services in this field.
83. Statistics however indicate a minimal application of the Direc­
tives; less than 1 ECU in 4 of public expenditure in the areas 
covered by the co-ordination Directives is the subject of 
publication in the Official Journal and thus, even theoretically, 
of Community-wide competition.
84. The Commission will open discussions with Member States and through 
them with the awarding entities on the application of the 
Directives. Such discussions have to be based on detailed studies 
of the Directives' transposition and application in each Member 
State, concentrating on a number of key areas such as procedural 
details (splitting of contracts, use of single tendering), 
particular entities (Defence, Health, Regional Government), and 
products (computers, vehicles, medical equipment and supplies). In 
addition further action will be taken to improve the quality and 
speed of the publication of notices to tender and especially to

develop the 'electronic publishing system TED (Tenders'' Electronic Daily).
In order to stimulate a wider bpening up of tendering for public 
contracts, there is a serious and urgent need for improvement of 
the Directives to increase transparency further. Priority should be 
given to a system of prior information ; to publication of the 
intention to use single tender procedures ; to publication of the 
awards of contracts ; and to improved quality and frequency of 
statistics. Moreover, in view of the high volume of contracts 
falling below the present levels of the threshold where the 
Directives apply, a review of these levels would seem appropriate. 
Besides, more visible action by the Commission in policing 
compliance with existing law will increase the credibility of the 
Community's efforts to break down the psychological barriers to 
crossing frontiers.
Four major sectors - energy, transport, water and (in the case of 
supply contracts) telecommunications - are at present not covered 
by Directives. Whi1st it is clear that enlargement of coverage must 
be realised before 1992, additional action is required to take 
account of the fact that some of the awarding entities in these 
sectors fall under public law, while others are private bodies. 
Possible options are an approximation approach by way of Di rectives 
and/or a competition approach based on Articles 85, 86 and 90 of 
the EEC Treaty, sometimes combined with an initially more 
pragmatic approach, such as has been tried in the telecommu­
nications sector. The Commission will submit proposals before the end of 1987.
Community-wide liberalisation of publie procurement in the field of 
public services is vital for the future of the Community economy. 
Article 58 of the EEC Treaty fully applies but, at present, only 
construction contracts are covered by Directive 71/305/EEC · , the 
supply of goods may include incidental services only to the extent 
that the value of the latter does not exceed that of the products 
themselves. This limitation should be removed so that access to 
publicly financed service contracts such as the services associated 
with the construction industry are also opened up to suppliers from 
other Member States. There are also certains services in the new 
technology area (see paragraphs 113- 123 below) which need a large 
market of continental dimensions in order to realise their full 
potential. An example would be data processing in all its forms, a 
sector where possible procurement policies have a major impact. 
Furthermore, the transformation of contracts to purchase into 
contracts for the supply of services is already having an impact 
on the coverage of the supplies Directive, mainly in the field of 
computers. The Commission will submit proposals before 1987 which 
should lead to Council action in 1988 by the latest.

-  25 -
III. FREE HOVEHENT FOR LABOUR AND THE PROFESSIONS : A NEU INITIATIVE IN
FAVOUR OF COMMUNITY CITIZENS
88. The Commission considers it crucial that the obstacles which still 
exist within the Community to free movement for the self-employed 
and employees be removed by 1992. It considers that Community 
citizens should be free to engage in their professions throughout 
the Community, if they so wish, without the obligation to adhere to 
formalities which, in the final analysis, could serve to discourage 
such movement.
89. In the case of employees, it should be noted that such free
movement is almost entirely complete and the rulings of the Court 
of Justice restrict the right of public authorities in Member 
States to reserve posts for nationals. Certain problems still 
exist, however, and the Commission intends to make the necessary 
proposals which will eliminate the last obstacles standing in the 
way of the free movement and residence of migrant Community 
workers. Furthermore the Commission will take measures in order to 
remove cumbersome administrative procedures relating to residence 
permits. The Commission has already submitted a proposal concerning 
the taxation of these workers and their families. The main problem 
in this case is the taxation of wage-earners who reside in one 
Member State and earn their income in another (this affects mainly 
frontier workers).
90. The Commission will also make further efforts to bring about the 
adoption and swift implementation of its proposal concerning the 
comparability of vocational training qualifications aimed at 
ensuring that vocational proficiency certificates are more easily 
comparable. In practical terms, this objective should be achieved 
by 1988 so that the second phase can be launched before 1990. This 
second phase would involve the introduction of an European 
"vocational training card", serving as proof that the holder has 
been awarded a specific qualification.
91. In the field of rights of establishment for the .  self-employed,
little progress has been made, the main reason being the
complexities involved in the endeavour to harmonize professional 
qualifications. However these endeavours have resulted in a 
considerable degree of freedom of movement for those engaged in the 
health sector. The European Council, owing to the hold-ups 
previously experienced in this sphere, indicated its desire to 
promote measures that would offer tangible improvements in the 
everyday life of Community citizens. In particular, during the 
meeting in Fontainebleau it called for the creation of a general 
system for the mutual recognition of university degrees. In line 
with the same philosophy, the Commission believes that there should 
be mutual recognition of apprenticeship courses.
92. The Adonnino Committee submitted a preliminary report in March this 
year which contains some guidelines on this subject, and the 
Commission has been requested to put them into concrete form.
93. For this reason, with the aim of removing obstacles to the right of 
establishment, the Commission - which approved the conclusions of 
the Adonnino report - will submit to the Council a draft framework

-  26 -
Directive on a general system of recognition in the course of this 
year. The main elements in this system will be :  the principle of
mutual trust between the Member States; the principle of the 
comparability of university studies between the Member States; the 
mutual recognition of degrees and diplomas without prior 
harmonization of the conditions for access to and the exercise of 
professions ; and the extension of the general system to salary 
earners. Lastly, any difference, notably as regards training, 
between the Member States would be compensated by professional 
experience.
94. Finally, measures to ensure the free movement of individuals must 
not be restricted to the workforce only. Consequently, the 
Commission intends to increase its support for cooperation 
programmes between further education establishments in different 
Member States with a view to promoting the mobility of students, 
facilitating the academic recognition of degrees and thus diplomas, 
and helping young people, in whose hands the future of the
Community's economy lies, to think in European terms. At the end of 
this year, it will make new proposals on this subject, notably 
concerning a Community scholarship scheme of grants for students 
wishing to pursue part of their studies or the acquisition of 
relevant professional experience in another Member State.
IV. A COMMON MARKET FOR SERVICES
95. In the Commission's view, it is no exaggeration to see the 
establishment of a common market in services as one of the main 
preconditions for a return to economic prosperity. Trade in 
services is as important for an economy as trade in goods. The 
diversity of activities which can be classed as "services" and the 
fact that the providers of services seem unaware of their common 
interests in the sector are two of the reasons why their role and 
importance have been undervalued for so long. Another reason has 
been the fact that, in the past, many services were provided by 
industry itself whereas now there is a trend to create specialist 
companies or at least specialist units for service activities. 
Despite the provisions of Articles 59 and 62 of the Treaty, 
progress on the freedom to provide services across internal 
frontiers has been much slower than the progress achieved on free 
movement of goods. This is particularly regrettable, since in 
recent years specialisation and the rapid development of new types 
of services has done much to demonstrate the potential for growth 
and job creation in the service sector as a whole.
96. Two examples should suffice to illustrate this potential, and to 
point out the risk that the Community might lose ground to its main 
trading competitors if it fails to take sufficiently far-reaching 
action.
97. First, in 1982 market services and non-market services already
accounted for 57% of the value added to the Community economy while 
industry's contribution has dropped to less than 26%. Secondly, a

-  27 -
comparison of employment prospects in the different sectors between 
1973 and 1982 reveals that there has been a steady decline in 
employment in industry, which became even more rapid after 
1979/1980. By contrast, over the same period, more than 5 million 
jobs were created in the Community's market services sector. This 
figure, while impressive in absolute terms, looks less so relative 
to the equivalent figures for the USA (13.4 million) and even 
Japan (6.7 million). Another cause for concern is that in the 
Community, unlike in our main competitors, this trend has tailed 
off since 1980 as a result of the recession.
98. Although freedom to provide services in the Community has been
directly applicable since the end of the transitional period as the 
Court of Justice recognized in the Van Binsbergen judgement, firms 
and individuals have not yet succeeded in taking full advantage of 
this freedom.
99. For these reasons, the Commission considers that swift action should
be taken to open up the whole market for services. This applies 
both to the new service areas such as information marketing and 
audiovisual services ; and to the so-called traditional (but 
rapidly evolving) services such as transport, banking and insurance 
which, if properly mobilised, can play a key supporting role for 
industry and commerce.
"Traditional” Services
100. Of prime importance - because the Community has been depriving 
itself of the potential benefits for far too long - is the need to 
open up the cross-border market in the traditional services, 
notably banking and insurance and transport. The Commission would 
emphasize here that proposals necessary to open up these two 
sectors have already been made but still await Council's decision. 
The Council should, therefore, take the appropriate decisions as 
indicated in the timetable to be completed by 1990.
Financial services
101. The liberalisation of financial services, linked to that of capital 
movements, will represent a major step towards Community financial 
integration and the widening of the Internal Market.
102. The accent is now put increasingly on the free circulation of 
"financial products", made ever easier by developments of 
technology. Some comparison can be made between the approach 
followed by the Commission after the "Cassis de Dijon" judgements 
with regard to industrial and agricultural products and what now 
has to be done for insurance policies, home-ownership savings 
contracts, consumer credit/ participation in collective investment 
schemes, etc. The Commission considers that it should be possible 
to facilitate the exchange of such "financial products" at a 
Community level, using a minimal coordination of rules (especially 
on such matters as authorisation, financial supervision and 
reorganisation, winding up, etc) as the basis for mutual

-  28 -
recognition by Member States of what each does to safeguard the 
interests of the public.
103. Such harmonisation, particularly as regards the supervision of 
ongoing activities, should be guided by the principle of "home
country control". This means attributing the primary task of
supervising the financial institution to the competent authorities 
of its Member State of origin, to which would have to be commu­
nicated all information necessary for supervision. The authorities 
of the Member State which is the destination of the service, whilst 
not deprived of all power, would have a complementary role. There 
would have to be a minimum harmonisation of surveillance stan­
dards, though the need to reach agreement on this must not be 
allowed further to delay the necessary and overdue decisions.
104. The implementation of these principles in the field of credit 
institutions (especially banks) is being pursued actively, in par­
ticular on the following lines :
- the standards of financial stability which credit institutions 
must live up to and the management principles which they must 
apply (concerning, for instance, their own funds, the solvency 
and liquidity ratios, the monitoring of large exposures) are 
being thoroughly coordinated ;
- the rules contained in the fourth and seventh company law Direc­
tives on annual accounts and consolidated accounting are being 
adapted to the sector of credit institutions ;
- furthermore, the conditions which must be fulfilled by insti­
tutions seeking access to the markets as well as the measures to 
be taken at Community level when it comes to reorganising or 
winding up an institution in case of crisis are being coordi­
nated;
- to name a more specific area, the Commission is working towards
the mutual recognition of the financial techniques used by
mortgage credit institutions and of the rules applying to the 
supervision of such institutions.
105. As regards insurance undertakings, directives adopted in 1973
(non-life) and 1979 (life) to facilitate the exercise of the right 
of establishment already coordinate rules and practices for the 
supervision of insurers and particularly of their financial 
stability. Moreover, close cooperation between supervisory 
authorities has been in existence for a long time. The ground is 
thus prepared for freedom of services across frontiers, which
should therefore not present insurmountable problems, especially 
since the Directive of 11 May 1960 liberates capital movements with 
regard to premiums and payments in respect of all forms of 
insurance. It must nevertheless be noted that a Directive intended
to facilitate the exercise of freedom of services in non-life
insurance by spelling out the part to be played by the various 
supervisory authorities in cross-frontier operations has not yet

-  29 -
been adopted by the Council. It will furthermore be necessary in 
the near future to examine closely those aspects of freedom of 
services which are peculiar to life assurance.
106. In the securities sector, the coordination of rules applicable to 
undertakings for collective investment in transferable securities 
(UCITS) is aimed at providing equivalent safeguards for investors 
in respect of the units issued by UCITS, irrespective of the Member 
State in which the UCITS is situated. Once approved by the 
authorities in its home Member State, a UCITS will be able freely 
to market its units throughout the Community, without permitting 
additional controls to be introduced. Thus this directive would be 
an example of the principle of "home country control". Mutual 
recognition will be made possible by the coordination of the 
safeguards offered by the financial product in question.
107. Apart from the UCITS proposal, other work still remains to be done 
to ensure that securities markets operate satisfactorily and in the 
best interests of investors. Work currently in hand to create a 
European securities market system, based on Community stock 
exchanges, is also relevant to the creation of an internal market. 
This work is designed to break down barriers between stock 
exchanges and to create a Community-wide trading system for 
securities of international interest. The aim is to link stock 
exchanges electronically, so that their members can execute orders 
on the stock exchange market offering the best conditions to 
their clients. Such an interlinking would substantially increase 
the depth and liquidity of Community stock exchange markets, and 
would permit them to compete more effectively not only with stock 
exchanges outside the Community but also with unofficial and 
unsupervised markets within it.
Transport
108. The right to provide transport services freely throughout the 
Community is an important part of the Common Transport Policy set 
out in the Treaty. It should be noted that transport represents 
more than 7 % of the Community's g.d.p., and that the development 
of a free market in this sector would have considerable economic 
consequences for industry and trade. The recent decision of the 
Court in the case brought by the European Parliament against the 
Council for failure to act in the field of the common transport 
policy (Case 13/83) highlights the necessity of making rapid 
progress in this area.
109. In addition to the measures already mentioned in the context of the 
elimination of frontier checks in road haulage traffic, the 
completion of the internal market requires the following actions in 
the transport sector :
- for the transport of goods by road between Member States, the 
phasing out of quantitative restrictions (quotas) and the 
establishment of conditions under which non-resident carriers may

-  30 -
operate transport services in another Member State (cabotage) 
will be completed by 1988 at the latest.
- for the transport of passengers by road, freedom to provide 
services will be introduced by 1989.
- for the international transport of goods by inland
waterway,freedom to provide services where this is not yet the
case will be introduced. Where necessary, conditions will be 
established under which non-resident carriers may operate inland 
navigation services in another Member State (cabotage). Both 
measures should come into effect by 1989.
- the freedom to provide sea transport services between Member
States shall be established by the end of 1986 at the latest,
though with the possibility of a limited period for phasing out
certain types of restrictions.
- in the air transport sector, it is necessary to provide by 1987 
for greater freedom in air transport services between Member 
States. This will involve in particular changing the system for 
the setting and approval of tariffs, and limiting the rights of 
Governments to restrict capacity and access to the market.
110. Implementation of common policy measures in the transport sector by 
the dates mentioned above will require decisions by the Council by 
December 1985 (air fares and some aspects of maritime transport) ; 
by June 1986 (remaining aspects in the aviation and maritime 
sectors) ; and by December 1986 (road haulage, inland waterways, coach services).
111. If the Council fails to make progress towards the adoption of 
proposed Regulations concerning the application of competition 
rules to air and to sea transport, the Commission intends to take 
Decisions recording existing infringements and authorising Member 
States to take measures as determined by the Commission according 
to Article 89 of the EEC Treaty.
112. All these measures form only part of the common transport policy 
which extends to other measures (e.g. state aid policy, improvement 
of railway financing, harmonization in the road sector, 
infrastructure planning and investment) which are not of direct 
relevance to the internal market but which are an essential element of this policy.
New technologies and Services
113. The development of new technologies has led to the creation and 
development of new cross-border services which are playing an 
increasingly important role in the economy. However, these 
services can develop their full potential only when they serve a 
large, unobstructed market. This applies equally to audiovisual 
services, information and data processing services and to 
computerized marketing and distribution services.

-  31 -
114. In addition, the Commission would stress that a market free of 
obstacles at Community level necessitates the installation of 
appropriate telecommunication networks with common standards.
115. In the field of audiovisual services, the objective for the 
Community should be to seek to establish a single Community-wide 
broadcasting area. Broadcasting is an important part of the 
communications industry which is expected to develop very rapidly 
into a key sector of the Community economy and will have a decisive 
impact on the future competitiveness of Community industries in the 
internal market.
116. In accordance with the Treaty objective of creating a common market 
for services, all those who provide and relay broadcast services 
and who receive them should be able, if they wish, to do so on a 
Community-wide basis. This freedom goes hand in hand with the 
right of freedom of information regardless of frontiers.
117. As a result of the development of broadcasting within essentially 
national frameworks, legal obstacles, actual and potential, lie in 
the path of those seeking to develop broadcasting activities across 
the borders of Member States. These obstacles consist mainly of 
different limitations on the extent to which broadcast programmes 
may contain advertising ; as well as of the rights of owners of 
copyright and related rights to authorise retransmission by cable 
of broadcasts for each Member State separately. On the basis of 
the Commission's Green Paper, adopted in May 1984, on the 
establishment of the common market for broadcasting, especially by 
satellite and cable, a number of measures are necessary to realise 
a single Community-wide broadcasting area. As a first step towards 
this objective, the Commission will submit appropriate proposals in 
1985. The Council should take a decision before 1987.
118. The information market is also undergoing far reaching changes as a 
result of the application of new information technologies. These 
changes are mainly due to :
- the almost exponential growth of the amount of information 
available ;
- the growing speed with which new information becomes obsolete ;
- the strong tendency of information to flow across borders; and
- the application of new information technologies.
119. Information itself and information services are becoming more and 
more widely traded and valuable commodities, and in many respects 
primary resources for industry and commerce. The opening of the 
market for it is therefore of increasing importance. Moreover, the 
functioning of markets for other commodities depends upon the 
transmission and availability of information. As a commodity, 
however, it has unique and difficult properties.
120. The information market has been supported by a series of programmes 
decided by the Council on 27 July 1981 and 27 November 1984. The 
current one is due for mid-term evaluation in the course of this 
year. But a satisfactory internal market requires more. It

-  32 -
requires, as the European Council has recognized, a common policy 
and strategy within which a transparent regulation and transparent 
conditions can be built. The Commission has issued a general 
discussion paper on this subject and intends to follow it up with 
appropriate proposals and guidelines in the period 1985-1987.
121. The European marketing and distribution system will also undergo a 
thorough technological transformation. Home videotex will permit 
the ordering of products direct from the manufacturer, thus 
revolutionizing traditional distribution channels, while ensuring 
greater market transparency. These new technologies, which will 
bring in their wake a need for adequate consumer protection, could 
lead to increased commercial activity within the Community, 
particularly in the mail-order sector.
122. Electronic banking .too will promote information and commercial 
transactions. The new payment cards (memory cards, on-line cards) 
will tend to replace existing cheques and credit cards. Although 
an agreement already exists on the compatibility of videotex 
equipment in the Community, there is no similar agreement for the 
production of the new cards.
123. The Commission intends to make proposals to help define common 
technical features of the machines used to produce the new payment 
cards, so that they can be identical throughout the Community. It 
will also seek to encourage, in conformity with Community 
competition rules, the conclusion of agreements at European level 
between banks, traders, producers and consumers on the 
compatibility of systems, networks linkage, user rules and/or rates of commission.
V. CAPITAL MOVEMENTS
124. Greater liberalisation of capital movements in the Community should 
serve three aims.
125. First, the completion of a large internal market inevitably invol­
ves a financial dimension. The free movement of goods, services 
and persons must also mean that firms and private individuals 
throughout the Community have access to efficient financial 
services. The effectiveness of the harmonisation of national 
provisions governing the activities of financial intermediaries and 
markets would be greatly reduced if the corresponding capital 
movements were to remain subject to restrictions.
126. Secondly, it must be stressed that monetary stability, in the sense 
of the general level of prices and exchange rate relations, is an 
essential precondition for the proper operation and development of 
the internal market. In this regard, action to achieve greater 
freedom of capital movements would need to move in parallel with
the steps taken to reinforce and develop the European 
Monetary System. Exchange-rate stability and convergence of 
economic policies help the gradual removal of barriers to the free

-  33 -
movement of capital; conversely, greater financial freedom leads to 
greater discipline in the conduct of economic policies.
127. Thirdly, the decompartmentalisation of financial markets should 
boost the economic development of the Community by promoting the 
optimum allocation of European savings. The task is to set up an 
attractive and competitive integrated financial system for both 
Community and non-Community business circles.
128. A number of Member States have had to make use of the protective 
clauses provided for in the Treaty (Articles 73 and 108(3))to 
maintain or reintroduce restrictions on capital movements which are 
in principle liberalised under Community law. From now on the 
Commission's attitude towards the use of safeguard clauses will be 
governed by the following criteria :
- authorization to apply protective measures should be for a 
limited period;
- measures should be continually reviewed and gradually abolished 
as the difficulties which originally justified them diminish;
- agreement should be reached not to apply the protective clauses 
to capital movements which are so short term as to be classified 
as speculative and which are most directly Linked to the free 
movement of goods, services and persons.
129. Generally speaking, however, capital now moves more freely in the
Community than at the end of the 1970s. The United Kingdom removed 
all exchange controls in 1979 and the arrangements applied in 
Denmark now comply with the Community rules in force. In
December 1984, the Commission authorised France, Italy and Ireland 
to retain, according to the above criteria, in varying degrees, 
restrictions on certain capital movements. These decisions took 
into account the measures taken on this occasion by the French and 
Italian authorities to relax such restrictions. These derogations 
have been renewed for a limited period.
130. Unlike the Treaty provisions relating to free trade in goods and 
services, the principle of freedom of capital movements does not 
apply directly. All progress towards such freedom involves an 
extension, by way of Directives, of the Community obligations last 
Laid down in 1960 and 1962. The following two aims must be pursued 
in view of this extension :
- as an accompaniment to measures to coordinate the conditions 
under which financial intermediaries operate and thus to promote 
the development of a common market in financial services. To 
this end, a proposal for a Directive concerning the 
liberalisation of transactions in the units issued by collective 
investment undertakings for transferable securities is currently 
being discussed by the Council. A similar liberalizing proposal 
will be necessary in due course in the mortgage lending field;

-  34 -
- in order to adapt Community obligations to changes in financial 
techniques and so improve the arrangements for operations which 
have grown substantially in importance. Action will have to be 
taken at Community level to liberalise operations such as the 
issue, placing and acquisition of securities representing risk 
capital, transactions in securities issued by Community 
institutions and long-term commercial credit.
131. In addition to the responsibility which Community bodies have for 
creating and administering a legislative framework for the 
liberalisation of capital movements they will have to take action 
with a view to gradually liberalizing all operations of Community 
interest.
132. The Commission intends to step up its monitoring of any exchange 
control measures which, while not infringing Community obligations 
to liberalise capital movements, nevertheless constitute a 
potential obstacle to payments relating to normally liberalised 
trade in goods, services or capital. Following the "Luisi-Carbone" 
judgement of 31.1.1984, the Commission has already informed Member 
States about the limits to the controls which Member States may 
apply. From 1992 onwards, any residual currency control measures 
should be applied by means other than border controls.
VI. CREATION OF SUITABLE CONDITIONS FOR INDUSTRIAL COOPERATION
133. The removal of internal boundaries and the establishment of free 
movement of goods and capital and the freedom to provide services 
are clearly fundamental to the creation of the internal market. 
Nevertheless, Community action must go further and create an 
environment or conditions likely to favour the development of 
cooperation between undertakings. Such cooperation will strengthen 
the industrial and commercial fabric of the internal market 
especially in the case of small and medium sized enterprises, which 
are particularly sensitive to their general environment precisely 
because of their size.
134. In spite of the progress made in creating such an environment, 
cooperation between undertakings of different Member States is 
still hampered by excessive legal, fiscal and administrative 
problems, to which are added occasional obstacles which are more a 
reflection of different mental attitudes and habits. It is, 
however, the Commission’s function to take steps to deal with any 
distortion of competition arising from the partitioning of markets 
by means of agreements on business practices or undisclosed aid 
from public funds. The Commission will also continue to apply 
competition rules by authorizing cooperation between undertakings 
which can promote technical or economic progress within the framework of a unified market.
135. The Commission will also seek to ensure that Community budgetary 
and financial facilities make their full contribution to the 
development of greater cooperation between firms in different

-  35 -
Member States. It will seek to guide future research programmes in 
this direction, both at the precompetitive research stage and at 
the stage of pilot or demonstration projects. The ESPRIT and BRITE 
programmes now underway have already had a very positive impact on 
European firms in terms of the opportunities for cooperation which 
they represent. The Regional Fund must also be enabled to 
contribute to greater cooperation between firms.
Creation of a legal framework facilitating cooperation between  
enterprises.
136. The absence of a Community legal framework for cross-border 
activities by enterprises and for cooperation between enterprises 
of different Member States has led - if only for psychological 
reasons - to numerous potential joint projects failing to get off 
the ground. The Community is now, for the first time, setting the 
stage for a new type of association to be known as the "European 
Economic Interest Grouping" that will be governed by uniform 
Community legislation and will make it easier for enterprises from 
different Member States jointly to undertake specific activities.
137. Also, it is worth noting that a Council decision is still awaited 
on the proposed statute for a European Company. The Commission is 
conscious that the creation of an optional legal form at Community 
level holds considerable attraction as an instrument for the 
industrial cooperation needed in a unified Internal Market. A 
decision on the proposed statute will clearly be needed by 1992. In 
the interim period, the Commission intends to concentrate on 
measures to approximate national laws and does not preclude the 
possibility of amending its European Company proposal in order to 
build on results achieved in discussions of approximation measures.
138. The small number of one-man businesses apart, enterprises are 
generally organised in the form of companies or firms, and the 
Community rule on non-discriminatory treatment applies to them when 
formed in the Community. This rule is of prime importance where the 
acquisition of shareholdings is concerned.
139. There is a case, however, for making better use of certain 
procedures such as offers of shares to the public for reshaping the 
pattern of share ownership in enterprises, since the rules 
currently in force in this sphere vary a great deal from one 
country to another. Such operations should be made more attractive. 
This could be done by requiring minimum guarantees, particularly on 
the information to be given to those concerned, while it would be 
left to the Member State to devise procedures for monitoring such 
operations and to designate the authorities to which the powers of 
supervision were to be assigned. A proposal will be made in 1987 
and the necessary decisions should be taken by 1989.
140. As and when the internal market is developed further, enterprises 
incorporated in the form of companies or firms will become more and 
more involved in all manner of intra-Community operations, 
resulting in an ever-increasing number of links with associated

-  36 -
enterprises, creditors and other parties outside the country in 
which the registered office is Located. To keep pace with this 
trend, a series of measures have already been taken or are under 
discussion aimed at coordinating Member States laws, especially 
those governing limited companies, which, in economic terms,
constitute the most important category.
141. Admittedly, this approximation of legislation is designed to secure 
equivalent protection for those concerned but these are, to a very 
large extent, enterprises too. In point of fact, by improving the 
legal relationship between enterprises, the coordination of company 
law has at the same time improved cooperation between them.
142. Nevertheless, a company constituted under a specific national law
does not enjoy the same facilities as a natural person when it
comes to moving from one Member State to another. The traditional
ways of setting up in another Member State involve the 
establishment of subsidiaries or branches, for which non- 
discriminatory treatment is expressly laid down in the Treaty of 
Rome. As things stand now, however, the legal position of branches 
set up by companies from other Member States is far from
satisfactory throughout the Community. Thus, to the extent that 
certain matters affecting the corporate sector have already been 
harmonised, branches established in the Community and forming an 
integral part of an enterprise should also reap the benefits of 
such harmonisation under a legislative policy of deregulation. With 
this in mind, the obligation, say, to publish accounts relating 
only to the activities of a branch established in the Community
should be dispensed with in all cases, provided a copy of the 
parent company's accounts is filed with the registration body 
responsible for the branch. A proposal will be made in 1986 to 
permit a decision by the Council in 1988.
143. If it is to satisfy the needs of a genuine internal market, the
Community cannot concentrate simply on the arrangements for 
creating subsidiaries or branches in order to make it easier for 
enterprises to set up in other Member States. Enterprises must 
also be able to engage in cross-border mergers within the 
Community. This facility could constitute the last stage in a
process of cooperation beginning, for example, with the 
straightforward acquisition of a shareholding. On the face of it, 
adoption of the Commission's proposal for a tenth Di rective seems 
to pose fewer difficulties especially as it could, to a very large 
extent, settle the matter by reference to the rules already in 
force on internal mergers.
144. In practice, cooperation will result more often than not in the 
creation of a group of legally separate but associated enterprises. 
This development is already the subject of coordination in the 
field of consolidated accounts. However, is it possible to stop 
there ? The fact is that the transparency of the group is not the 
only issue at stake. A fair balance must also be struck between 
the interests of the group as a whole and its members, especially 
minority shareholders and creditors of subsidiaries. However,

-  37 -
there are serious gaps in most Member States' Legislation on the 
matter, which is still too closely modelled on the idea of company 
autonomy, an idea largely overtaken, it would seem, by the degree 
of concentration that now exists. Depending on the outcome of 
current consultations, the Commission is considering making a 
proposal to this end.
Intellectual and industrial property
145. Differences in intellectual property laws have a direct and 
negative impact on intra-Community trade and on the ability of 
enterprises to treat the common market as a single environment for 
their economic activities.
146. It will be necessary, as a first step, to reach a decision on the 
Community Trademark proposal and on the proposal approximating 
national trade mark laws. Considerable advantages will flow from 
this which will enable undertakings to adapt their activities to 
the full scale of the Community by making it possible for them to 
obtain on a single application one trade mark covering all the 
Member States. In order to allow the Community trade mark system to 
be adopted by the Council, the Commission will make the necessary 
supplementary proposals (i.e. the rules implementing the regu­
lation ·, the fees regulation ; the siting of the Community Trade 
Mark office and-  its working language ; the rules of procedure of 
the Boards of Appeal). The Council should decide on these matters 
by 1987.
147. The picture has recently been further complicated by the need to 
adapt existing trademark systems to technological change in a 
number of areas including computer software, microcircuits and 
biotechnology. In order to create a firm legal foundation for 
investment in new techniques, the systems must be adapted in a 
convergent manner so that these changes will not weaken an already 
imperfect intellectual property market.
148. In the patent field, the Luxembourg Convention on the Community 
Patent signed in 1975 which will offer important advantages to 
industry, has not yet entered into force. The Commission favours a 
solution whereby the Convention enters into force immediately, at 
least amongst those Member States who are in a position to ratify 
it.  .
149. The Commission accordingly intends to propose to the Council 
measures concerning patent protection of biotechnological 
inventions and the legal protection of microcircuits, the latter as 
a matter of urgency, in 1985. In addition, problems in the field of 
copyright and related rights will be examined in a consultative 
document to be published in 1985 with a view to establishing 
priorities. In this context, the introduction of a Community 
framework for the legal protection of software will be given 
particular attention.

-  38 -
Taxation
150. The Commission intends to publi sh, by the end of 1985, a White
Paper on the taxation of enterprises in the Community. This will 
serve the purpose of fitting the various proposals already pending 
before Council into a general framework; It will also be an
opportunity for assessing the need for further common action in 
this field. There is, indeed, a widespread feeling in private 
enterprise in Europe that our fiscal environment for risk capital 
and for innovation compares badly with that of our major 
competitors.
151. In the meantime the Commission will urge the Council to complete 
ongoing work on a group of proposals which aim at removing 
obstacles to cooperation between European firms (on tax treatment 
of parents and subsidiaries, on taxation of mergers and on 
avoidance of double taxation), and to give high priority to 
harmonizing indirect taxes on transactions in securities as well as 
to the proposal which will allow wider use of carry forward and 
backward of losses in all Member States.
VH. APPLICATION OF COMMUNITY LAW  
Infringements
152. The Community's political and legislative efforts to create an 
expanded home market for the people and the industries of the 
Community, will be in vain if the correct application of the agreed 
rules is not ensured. Unfortunately, under the pressure of 
economic crisis, Member States have not always withstood the 
temptation to yield to protectionist measures, and the large volume 
of complaints that the Commission has received has prevented it 
from dealing with them within a reasonable period. There is no 
reason why Member States, whose Heads of State and Government are 
committed to the completion of the Internal Market, should not 
expect and welcome the knowledge that the Commission will carry out 
its duties of enforcing the rules that make such a completion 
possible, even if such enforcement is likely sometimes to affect 
them directly and individually.
153. Of the total number of complaints received by the Commission, some 
60 %, i.e. on average 255 each year, relate to Articles 30-36 of 
the Treaty, but because of the lack of resources it can, in a given 
year, settle only one hundred cases. The resulting delays and 
backlogs benefit the infringing States, impede systematic action, 
lead to political and economic disequilibria of infringement 
proceedings, and frustrate the confidence of industry as well as 
that of the man in the street. Measures have to be taken to remedy 
the situation.
154. Moreover, the Commission will continue its general action of im­
proving and rationalising its internal procedures in order to 
correct violations rapidly and effectively. It will closely combine

-  39 -
its actions of prevention and cure, and it will consider the 
possible introduction of sanctions and will explore all
possibilities for interim measures to suspend the enforcement of 
any national legislation which manifestly infringes Community law.
Transparency
155. Elimination of unjustified trade barriers is traditionally done on 
a case-by case basis by individual infringement proceedings. Given 
the practical shortcomings of piecemeal proceedings, the Commission 
wilt have to take more systematic action, by publishing general 
communications setting out the legal situation particularly in 
regard to Articles 30 to 36 for the whole of an economic sector or 
in relation to a particular type of barrier. These communications 
would serve as a guide for public authorities regarding their 
obligations, as well as for Community citizens regarding the rights 
which they enjoy.
156. The Commission intends to publish before 1988 communications on
motor-cars, foodstuffs, pharmaceuticals, and chemical products as 
priority sectors. The Commission will gradually establish a
definite link between its proposals for harmonisation of laws and 
its communications setting out the impact of Articles 30 to 36. In 
any case, it is understood that, in the event of approximation 
lagging behind the agreed schedules, the Council's inaction cannot 
relieve the Commission of its obligation to take whatever measures 
are necessary to ensure free movement of goods within the Community 
under conditions which are consistent with the aims of the Treaty 
and the deadline of 1992.
Competition policy and state aids
157. A strong competition policy will play a fundamental role in
maintaining and strengthening the internal market. It will 
contribute to an improved allocation of resources and to
reinforcement of the efficiency and competitiveness of European 
companies. As the Community moves to complete the Internal Market, 
it will be necessary to ensure that anti-competitive practices do 
not engender new forms of local protectionism which would only lead 
to a re-partitioning of the market.
158. In this context, it will be particularly important that the
Community discipline on state aids be rigorously enforced. There 
are tendencies to spend large amounts of public funds on state aids 
to uncompetitive industries and enterprises. Often, they not only 
distort competition but also in the long run undermine efforts to 
increase European competitiveness. They represent a drain on scarce 
public resources and they threaten to defeat efforts to build the 
internal market. As the physical and technical barriers inside the 
Community are removed, the Commission will see to it that a 
rigorous policy is pursued in regard to state aids so that public 
resources are not used to confer artificial advantage to some firms 
over others. An effective Community discipline will make it 
possible to ensure that available resources are directed away from

-  40 -
non-viable activities towards competititive and job creating 
industries of the future.
The Commission is drawing up an inventory of state aids and will 
publish by 1986 a report setting out the implications for future 
state aids policy.

-  41 -
PART III - THE REMOVAL OF FISCAL BARRIERS
I. INTRODUCTION
160. Fiscal checks feature prominently among the functions carried out
at the Community's internal frontiers. Consequently^ the removal of 
frontier controls is bound to have inescapable implications for the 
Member States as far as indirect taxes are concerned. The
adjustments that will be needed to solve these practical problems 
are also very much in line with the terms of the commitment
undertaken by those who signed the Treaties and with historical 
developments since then.
161. When the Customs Union was achieved in 1968, it was already
apparent that the mere removal of tariffs would not enable a true 
common internal market to be created; and that differences in 
turnover taxes in particular were the source of serious distortion 
and hence a serious obstacle to the completion of the Internal
Market. That such a situation might arise was foreseen in the
Treaty itself. Article 99 specifically provided that the 
Commission should make proposals for the approximation of indirect 
taxation when this was needed for the completion of the internal 
market; and Article 100 provided the legal means for so doing.
162. Accordingly, in 1967, the Member States decided that the existing 
turnover taxes must be replaced by a Value Added Tax levied on a 
common basis. It was recognized from the outset that the 
imposition of such a tax on a common basis would raise many 
difficulties for Member States and would have to be phased in over 
a period of years. But it is clear from both the First and the 
Second VAT Directives which gave effect to this decision that a 
common basis was not only intended but was regarded as essential.
163. The adoption of a harmonized VAT was given further impetus by the 
Council Decision in 1970 that the Community should be financed 
through "own resources". A significant element in this new "own 
resources" regime was the allocation to the Community of the yield 
of part (not to exceed a rate of 1 per cent) of the harmonized VAT. 
It is clear from the Directives that what was in mind was not a 
notional calculation but the allocation of a specific share of an 
actual harmonized tax. The following year (1971) saw the adoption 
of a Council Resolution confirming its intention to create an area 
within which goods, services and capital could circulate freely and 
without distortions of competition. Not only was a common tax base 
regarded as essential to achieve this end, but common tax rates as 
well were contemplated. In the words of the Resolution :  "Before 
the end of the first stage, the Council will deliberate on the 
studies undertaken, and on the proposals made, by the Commission 
concerning the approximation of rates of value added tax and of 
excise duties."
164. The broad principles of the harmonized common tax base for VAT were 
laid down in outline in the Second VAT Directive dated 11 April 
1967. This was followed after a period of intensive consideration 
and discussion,· by the Sixth VAT Directive, adopted in 1977 which 
set out in great detail the provisions of the common base. Because

-  42 -
of the problems involved in reaching agreement on a number of 
difficult and contentious issues,, the Sixth Directive contains a 
number of lacunae as well as special schemes, derogations and 
transitional provisions. At the same time, Article 35 of the 
Directive specifically provided that these derogations and special 
arrangements should ultimately be brought to an end. Nowhere is 
the general philosophy set out more succinctly than in the preamble 
to the Directive. This declares :
"Whereas account should be taken of the objective of 
abolishing the imposition of tax on the importation and the 
remission of tax on exportation in trade between Member 
States; whereas it should be ensured that the common system 
of turnover taxes is non-discriminatory as regards the origin 
of goods and services, so that a common market permitting fair 
competition and resembling a real internal market may 
ultimately be achieved".
Since 1977 a number of supplementary Directives have been adopted 
and a number await the Council's decision.
165. Soon after the first steps were taken to harmonize turnover taxes, 
the Community turned its attention to excise duties. As a first 
step the Commission identified tobacco, alcoholic drinks and 
hydrocarbon oils as the products on which excises should be levied 
- a choice which coincides with the coverage adopted by most Member 
States.
166. In the case of tobacco, a limited degree of harmonization has 
already been achieved. The basic directive adopted in 1972 defined 
the structures of excise duty on cigarettes; provided for 
harmonization in successive stages; and defined a range of 
relationships between the specific duty and the total duty. In the 
case of alcoholic drinks and hydrocarbon oils, little progress has 
been made despite the presentation by the Commission of a whole 
range of directives. At the same time, however, a limited degree 
of progress has been made as a result of judgements by the European 
Court which have compelled Member States to abandon tax 
arrangements which benefited domestic producers to the detriment of 
producers in other Member States.
167. It is clear from what has been said above that the harmonization of 
indirect taxation has always been regarded as an essential and 
integral part of achieving a true common market. Momentum has been 
lost in recent years but this was due essentially to the impact of 
the recession on the economic policies of Member States and 
preoccupation with other problems. But progress is being resumed 
and now we must proceed vigorously if we are to achieve the target 
date of 1992 for the completion of the Internal Market.
168. If goods and services and people are to move freely from one member 
State to another in just the same way as they can move within a 
member State, it is essential that frontier controls be abolished. 
Since these are primarily designed to ensure that each member 
State can collect the revenue in the form of indirect taxation to 
which it feels entitled, there are clear implications for the 
indirect taxation policies of individual Member States. Let us be 
quite clear that we are talking here not in terms of frontier 
facilitation, i.e. simplifying frontier procedures in the way that

-  43 -
the Directive on the Harmonization of Frontier Procedures and the 
Single Administrative Document aim to do, but in terms of removing 
the frontiers altogether as only in this way is it possible to 
achieve the stated objective of free movement of goods and of 
people.
169. Indirect taxes, whether in the form of VAT or excises, enter more
or less directly into the final price of the goods or services on 
which they are imposed. Different levels of taxation are therefore 
reflected in different price levels. If the differences in level
are substantial, the differences in final prices will also be 
substantial, though small differences can often be absorbed either 
in margins or by consumer indifference. Given the relationship 
between prices and levels of taxation, we need to consider whether 
or not it would be practically possible, in the absence of frontier 
controls, for Member States to charge significantly different
Levels of indirect taxation.
170. The considerations which apply to commercial traffic and to the
individual traveller are not the same. They are therefore treated 
separately in the following paragraphs :  the VAT dimension is
examined first the analysis is then widened to include the
excises.
Cowercjal Traffic and Value Added Tax
171. The starting point must be the 14th VAT Directive and the system of
postponed accounting which shifts the accountancy procedures for 
VAT from frontiers to inland tax offices. The strongest point in 
favour of the 14th VAT Directive is that it embodies a tried and 
proven system, operated by Belgium, the Netherlands and Luxemburg, 
and previously by Ireland and the United Kingdom. For a variety of 
reasons, none of them convincing in the Commission's view, the
Directive has not yet been adopted by the Council, and this despite 
the fact that the system it incorporates has the solid backing of 
practical experience behind it. Adoption of the 14th VAT Directive 
would unquestionably represent a valuable step forward in
simplifying procedures and speeding the flow of commercial traffic. 
It would not, however, result in the complete abolition of frontier 
controls since documentation would still have to be provided at the 
frontier and Member States would still wish to retain the power to 
check movements of goods as a protection against fraudulent 
transactions which would deprive them of revenue.
172. If, therefore, frontiers and with them frontier controls are to be 
abolished, a satisfactory Community procedure will need to be found 
by which sales and purchases across borders would be treated in 
exactly the same way as similar sales and purchases within the 
borders of the Member States. In other words, the sale would be 
taxable in the hands of the vendor and the VAT incurred by the 
purchaser would be deductible irrespective of the Member State in 
which it has been charged. It would then be necessary, to set up a 
Community "Clearing House System" to ensure that VAT collected in 
the exporting Member State and deducted in the importing Member 
State was reimbursed to the latter. Computerisation of procedures 
will play an important role in this context.

-  44 -
173. In principle the Clearing House System described above would create
a situation for taxable persons within the borders of the Community 
identical to that which exists within the borders of the individual 
Member States. But in practice the present widely divergent rates 
and coverage of VAT would expose the system to the risk of heavy 
and systematic fraud and evasion. Apart from other devices it 
would be all too easy for traders in high rate Member States to 
obtain supplies from low rate Member States and omit them from 
their records. Not only would this be a loss of revenue, but such
practices would result in serious distortion of trade between low 
rate and high rate Member States. No one would pretend that fraud 
and evasion do not occur at present and would not continue even if 
tax rates and coverage were approximated. But the scale on which it 
could occur after the abolition of frontier controls without
approximation would be unacceptably large.
174. Furthermore, the Clearing House System could not deal with the
problem of the small trader not registered for VAT who could 
legitimately shop across the border and would do so where
significant differences in taxation and corresponding differences 
in prices existed.
175. The only conclusion that can be drawn from this analysis is that no
means exists of removing the frontier controls and thus the
frontiers if there are significant tax and corresponding price 
differences between the Member States.
The Individual Traveller
176. The fact that tax levels vary greatly from one member State to 
another results in considerable differences in prices and creates a 
powerful incentive for people living in high tax countries to cross 
the border and shop in low-tax countries. It needs to be 
remembered that many land'frontiers in the Community cross heavily 
populated areas. The Benelux countries, France and Germany come 
together in a geographical knot where cross-border shopping is easy 
and increasingly customary. Similar active cross-border shopping 
trade is found between Denmark and Germany and between the adjacent 
areas of Ireland and Northern Ireland.
177. It would not be possible without the introduction of a whole range
of new and offensive controls to discriminate between "genuine" 
travellers and those who crossed frontiers to go shopping. It has 
equally already been recognised that it is unacceptable to attempt 
to collect tax from every individual traveller carrying dutiable 
goods in however small quantities. For these reasons, and to 
facilitate travel within the Community, a system of "travellers' 
allowances" has been developed. First adopted in 1969, they now 
stand at goods worth 280 ECU plus modest prescribed quantities of 
cigarettes and alcoholic drink. Because of the problems of cross- 
border shopping, increasing difficulty has been experienced in
obtaining the agreement of Member States to even modest increases 
in the travellers' allowances. While an increase to 350 ECU may be 
agreed shortly, this is below what even in the present cir­
cumstances the Commission and the Parliament would consider to be 
reasonable.

-  45 -
178. The very existence of travellers® allowances, their modest amounts 
and the disproportionate difficulty in obtaining agreement to 
limited increases all demonstrate that it would be impossible to 
dismantle the fiscal frontiers unless there were a considerable 
measure of approximation of indirect taxation.
Excises
179. As far as the individual traveller is concerned, the position in 
relation to excises does not greatly differ from that relating to 
VAT. This analysis concentrates therefore on the considerations 
affecting commercial traffic.
180. At present, so far as the trade is concerned, goods subject to
excise duties are usually kept in bonded warehouses under control 
of the authorities, the tax being suspended. The tax is then 
charged when goods are taken from the bonded warehouse for 
consumption, that is, delivered to a distributor, or direct to a 
customer. When goods are exported, they are usually exported "in 
bond" i.e. duty is suspended and cancelled after proof of export. 
This in itself requires a check at the frontier. Correspondingly, 
checks are made and the potential liability is duly established at 
the point of entry into the importing country. Unless the goods
are imported into bond, duty then has to be paid. Alternatively, 
the goods may be received into a bonded warehouse and duty is then 
charged in the importing country only when the goods are about to 
go into consumption, i.e. when they are delivered from the bonded 
warehouse to a distributor or direct to the customer. While this 
system ensures that tax is charged only in the country where the 
goods are ultimately consumed, and at the rates of tax chargeable 
in that country, it presupposes the maintenance of existing
thorough frontier formalities.
181. It already open to the Council to produce the first simplification
of existing frontier procedures by adopting the directives on 
common structures for the excises which are already before it. A 
further streamlining could be achieved by linking national systems 
of excise suspension. Goods could then go from their place of 
production or from a bonded warehouse in the exporting country and, 
with a minimum of control, cross the frontier to a bonded warehouse 
in the importing country. The excise due would not be calculated 
and charged until the goods were taken out of "bond" in the country 
of destination. But though this system would indeed simplify
controls at the frontiers, it would not in itself mean that they 
could be abolished.
182. If frontier controls were dismantled while the present wide 
* differences in excise taxation persisted, the system would be
exposed to fraud and evasion. This situation would allow excised 
goods to be routed through a bonded warehouse in a low rate 
country, taken out of "bond" there and shipped on for consumption 
in a high rate country. There would also be a strong incentive for 
those traders in high rate countries who were not covered by the 
bonded warehouse system to obtain their goods in low rate 
countries. The only way of dealing with these problems would be to 
impose frontier controls, the very thing we are seeking to abolish.

-  46 -
183. We conclude that there is no way of removing frontier controls for 
goods subject to excise duties whilst the present significant 
differentials in coverage and rates continue to exist.
184. Whether from the point of view of commercial traffic or of the 
individual traveller, we conclude that the removal of frontiers 
together with the associated controls will require for practical 
reasons not only the setting up of a Community Clearing House 
System for VAT and a linkage system for bonded warehouses for 
excised products, but also a considerable measure of approximation 
of indirect taxes. We wish to make it clear that complete har­
monization, which has come to imply absolute identity in every 
respect, is not essential and for this reason we should now use the 
term "approximation".
11 * APPROXIMATION
185. The first question that has to be answered is how close does 
approximation have to be. The short answer is that it must be 
sufficiently close that the operation of the common market is not 
affected through distortions of trade, diversion of trade and 
effects on competition, in this connection, American experience is 
instructive. In the United States there are no fiscal frontiers as 
such, nor is there complete harmonisation of retail taxes as 
between the individual states. American evidence therefore 
suggests that some variations can be accommodated; but, in order to 
take account of market forces, these need to be limited in scale, 
with differences of upto 5% even between neighbouring states co­
existing without undue adverse effects. Transposing this experience 
into the Community context would suggest a margin of +/- 21/2 per 
cent either side of whatever Target Rate or Norm is chosen. In the 
case of VAT, this would be a very significant degree of 
flexibility. Thus, for example, if the Norm for the standard rate 
were 16 1/2 per cent, actual rates adopted by Member States could 
be in the range of 14 per cent to 19 per cent. These figures are 
inserted purely as an illustration although as a matter of interest 
the range of 14 per cent to 19 per cent encompasses the standard 
rates imposed by six of the nine Member States with VAT. In the 
case of excises, the indicative range of +/- 2 1/2 per cent would 
be less significant as excises frequently account for a large 
proportion of the retail price.
186. Retail markets are often tolerant of quite significant differences 
in retail prices. Distance, convenience, service, image and a host 
of other factors enter into consumer choice; price is only one. 
But where competition is severe, prices do tend to move to a common 
level. In such circumstances minor differences in tax levels tend 
to be absorbed by the trade, leaving the ultimate retail price to 
the consumer little affected. The pressures thus exerted on the 
trade will be transmitted to government. Thus market forces will 
themselves create pressures to achieve a degree of approximation 
and in one case have already done so in the Community.

-  47 -
The Broad Picture
187. It will require a great deal of statistical and econometric work 
before specific proposals can be put forward. Much of this work 
can only be done by or in association with Member State 
administrations. Indeed it would be surprising if many Member 
States had not, as a matter of routine, already made such studies. 
This White Paper therefore confines itself to a general analysis 
which will enable the broad picture to be seen and leave the 
detailed studies to be undertaken as part of the preparatory work 
on the draft directives which will be required.
188. Table 1 sets out the total yield of indirect taxation, subdivided 
into VAT and Excises, as a proportion of GDP in each of the 
Member States in 1982.
189. The point which emerges immediately is that for most Member States 
there are no very significant differences from the average in the 
total yield of indirect taxation.
TABLE 1 - Indirect taxation as percentage of the GDP (1982)
VAT EXCISES VAT AND
Per cent total Big five(1) EXCISES
Belgium 7.672.392.29 10..06
Denmark 9.845.873.27 15..71
Germany 6.342.702.58 9..04
France 9.192.222.12 11..41
Ireland 8.228.917.63 17..13
Italy 5.48 2.842.72 8..32
Luxembourg 6.044.243.75 10..28
Netherlands 6.832.361.92 9..19
United Kingdom 5.224.584.35 9..79
Weighted EC
Average (2) 7.053.633.37 10,.68
(1) Tobacco products, beer, wine, spirits and mineral oil products
(2) Excluding Greece, where the necessary statistics were not avai­
lable
190. Looked at in this way approximation presents a manageable budgetary 
problem for most Member States and it would not seriously disturb 
the existing relationship between direct and indirect taxation. 
The exceptions are Denmark and Ireland both of which rely heavily 
on indirect taxation and where the present level measured as a 
percentage of GDP is 50 per cent or more above the Community 
average.

-  48 -
191. When one Looks at the yield of the VAT and of the excises 
separately, bigger differences appear. In the case of the VAT a 
preponderance of Member States have a yield around 6 per cent of 
GDP (i.e. within the range 6 per cent +/- 1 per cent) but four 
States have yields higher than this, of which two exceed 9 per 
cent. In the case of the excises, there are five Member States 
with yields between 2 per cent and 3 per cent of GDP, three Member 
States with yields of around 5 per cent and one member State, 
Ireland, with a yield of no less than 8.9 per cent.
192. To sum up, the problem in most Member States is not so much the 
total yield of indirect taxation but the composition of that yield 
- the division between VAT and the excises and within the excises 
the differences in tax burden between different sectors and 
different products. But given adequate time and flexibility for 
spreading the change over a period of years, and given the 
necessary political will, the approximation could be realized and 
it could be handled with no greater difficulty than many Member 
States have encountered in determining their domestic tax policy.
Value Added Tax
193. There are three questions to be addressed in the case of VAT :
(1) the common base or coverage;
(2) the number of rates; and
(3) the level of the rate or rates, and particularly of the main or 
standard rate.
All these issues are interlocking :  the extent of the coverage has
an important bearing on the number of rates; and the level of 
rates is linked both to the number and to the coverage.
194. The 2nd VAT Directive introduced the main principles and the 6th 
VAT Directive went a long way to fill in the necessary details of a 
common VAT base in the European Community. In some areas it was 
not possible, however, to achieve unanimity. As a result certain 
gaps were left to be covered by subsequent directives, and a number 
of derogations were included.
195. Three of the supplementary directives stemming from the 6th
Directive have already been adopted by the Council (the 8th
Directive concerning arrangements for the refund of VAT to taxable 
persons established in another member State; a directive on VAT 
exemptions for final importation of certain goods; and the 10th 
Directive on VAT on the hiring out of movable tangible property).
196. Eight other draft Directives are still pending before the Council.
Together with three forthcoming proposals they aim at carrying 
forward the work of achieving the common VAT base. After their 
approval the main outstanding problem in this area will be the
remaining derogations. They will have to be tackled by subsequent 
proposals. The principal areas where substantial differences in 
coverage still exist are: food; second-hand goods; fuel and
transport; and the treatment of small traders and farmers. Some of 
the most important derogations are connected with zero-rating of 
food and other goods and services in Ireland and UK. This is why

-  49 -
VAT coverage is as Low as 35 per cent of private consumption in 
Ireland and 44 per cent in the United Kingdom whereas most Member 
States cover about 90 per cent. The high rates of tax imposed in 
Ireland and the comparatively low yield in the United Kingdom are 
both a reflection of this restricted coverage. A move towards a 
more uniform basis would therefore be helpful in both these 
respects.
197. Table 2 shows the rates of VAT in force in the Member States as at 
31 March 1985.
198. As far as the number of rates is concerned, seven out of the nine 
Member States at present impose VAT at a reduced rate or rates in 
addition to the standard rate and three of these also impose a 
higher rate. This would suggest that a common system would be 
likely to have more than one rate. Nevertheless, despite the 
present predominance of multiple rate systems, there are strong
•  arguments in favour of a single rate.
TABLE 2 - POSITIVE RATES OF VAT IN MEMBER STATES (1): As at March
1985..
VA
T Rates
lower standard higher VAT as per­
centage of 
GDP
Belgium 6 and 17 1925 (2) 7.67
Denmark- 22- 9.84
Germany 7 14- 6.34
France 5.5 and 7 18.633.3 9.19
Ireland (3) 10 23- 8.22
Italy 2 and 9 1838 5,48
Luxembourg 3 and 6 12- 6.04
Netherlands 5 19- 6.83
United Kingdom(3) - 15- 5.22
(1) Greece has not yet introduced VAT.
(2) An additional luxury tax of 8 per cent is charged on certain 
products.
(3) Ireland and the United Kingdom apply zero rates to a wide range 
of goods and services.
199. As regards the level of rates, it is of more than passing interest 
that approximation within a range of 14 per cent to 19 per cent for 
the standard rate (i.e. a Norm of 16 1/2 per cent +1-2 1/2 per 
cent) would encompass six of the nine Member States which have a 
VAT. A range of 15 per cent to 20 per cent (a norm of 17 1/2 per

-  5 o -
cent +/- 21/2 per cent) would encompass five Member States out of 
the nine. It must be stressed that these are only illustrative 
examples :  specific proposals must await more detailed study. The
Commission will in due course publish the results of these studies 
as a basis for further discussions.
Excises
200. In the case of the excises, Member States have fairly common
coverage as regards the excise duties on manufactured tobacco, 
alcoholic beverages and hydrocarbon oils. The main exception is 
wine. No duty is charged on wine in Italy or Greece, it is charged 
only on sparkling wine in Germany and only on imported wine in 
Luxembourg. Likewise certain hydrocarbon oil products are exempted 
from duty in some Member States: for example, heavy fuel oil in
Belgium, domestic heating oil in Belgium and Luxemburg, and 
lubricants in Belgium, France and the Netherlands.
201. In view of the large number of excisable products (for example 28 
alcoholic beverages, 7 mineral oils) it is not practicable to show 
all the rates for the Member States. Table 3 does, however, give a 
representative picture of comparative excise duty levels in the Community.
TABLE 3 - EXAMPLES OF EXCISE DUTIES IN MEMBER STATES - AS AT MARCH T985 ------— —----------------- -
EC
U per 20 cigar- 1 litre 1 litre 0.75 lit 1 lit of Revenue
ettes of beer of wine of 40% premium from
spirits petrol these
excises 
in per 
cent of 
GDP (1)
Belgium 0.730.13 0.,333.780.25 2.29Denmark 1.960.65 1.359.58(2)0.283.27Germany 1.020.07 0.003.430.232.58France 0.310.03 0.033.370.36 2.12Greece 0.280.22 0.00 0.160.29n.aIreland 1.141.142.747.840.36 7.63Italy 0.570.18 0.00 0.750.49 2.72Luxembourg 0.540.06 0.132.540.203.75Netherlands 0.740.23 0.333.790.28 1.92United K. 1,.250.70 1.607.700.29 4.35
11) 1982 figures 
(2) estimated average
202. For cigarettes the rates vary from 0.28 ECU per packet of 20 
(Greece) to 1.96 ECU (Denmark). The striking feature of the 
figures for beer, wine and spirits is that in each case the
heaviest taxation is to be found in Denmark, Ireland and the United

-  51 -
Kingdom. Since the excise duties represent an extremely high 
proportion of the retail price (up to 69 per cent for cigarettes, 
52 per cent for petrol), such wide discrepancies in excise taxation 
are bound to have significant effects on market prices and hence on 
the markets themselves.
III. THE COMMISSION'S PROPOSALS
203. The broad approach must now be for the Council to agree that ways 
must be found to ensure that the adjustment that will be required 
when internal frontier controls are abolished in 1992 is not too 
abrupt and that the interim period be put to the best possible use. 
A good start would be provided by Council agreement to intensify 
efforts at completing work on the VAT base and the structure of 
the excises, mainly on the basis of proposals already presented by 
the Commission. Simultaneously the Commission will put forward a 
standstill proposal to ensure that existing differences with
.  respect to the number of VAT rates and the coverage of excises are 
not widened.
204. A next step which we would hope could be taken in 1986 will be for 
the Commission to present Target Rates or Norms together with 
proposed ranges of variation. Member States will then have the 
option of moving a given indirect tax immediately or in a series of 
shifts towards the common rate band. During the same period 
further consideration will need to be given to existing derogations 
which have distorting effects on the Internal Market to see whether 
they need to be continued. The administrative arrangements 
necessitated by the new proposals will need to be put into place.
205. The following paragraphs set out the specific measures the 
Commission proposes should be taken together with reasonable target 
dates. VAT and excises are examined separately and in turn.
Value Added Tax
206. Work on the common VAT base should now be taken forward by the 
approval of proposals already presented by the Commission to the 
Council. They cover subjects like works of art, antiques and used 
goods, the import of second hand goods by final consumers 
(including the problem of double taxation) and the temporary 
importation of goods other than motor cars etc; and some Limited 
moves towards abolition of derogations provided for in the 6th VAT 
Directive.
There are eight draft directives involved. Considerable work has 
already been done by the Council on a number of the draft 
directives and they should all be approved by the end of 1986.
207. Three proposals will be presented by the Commission in 1985,
dealing with the special schemes for small businesses, for flat- 
rate farmers and for passenger transport. These should then be 
approved in the course of 1986.

-  52 -
208. While this work is proceeding in the Council, the Commission will, 
in the course of this year, put forward proposals for a 
"standstill". It will not be possible at this stage to define 
this in terms of rates, but provisions should be adopted which 
will exclude the proliferation of VAT rates in Member States, or 
the widening of the gap between VAT rates, since this would make 
subsequent adjustment more difficult.
209. Work on the next decisive stage, the approximation of rates, would 
commence after the Commission had presented the proposals. These 
will cover :
- the rate structure, i.e. whether the common VAT system has one, 
two or even more rates; if more than one rate is to be adopted 
the proposals must indicate which goods and services should be 
charged at each of the rates;
- the Target Rate(s) or Norm(s), i.e. the central rate or rates, 
together with the permitted ranges of variation around them.
The proposals for the rate band or bands should be accompanied by a 
standstill provision, under which Member States would undertake not 
to move away from, but only towards, the common goal.
210. On the basis of these proposals, the necessary adjustment of rates 
can then go forward. Member States would have a period of some 
years, following the adoption of the directives, in which to 
complete approximation by the end of 1992.
211. During the same period outstanding problems on the coverage of VAT
will need to be resolved. They include VAT derogations with
distortive effects, such as significant differences in taxation 
between Member States of the same goods or services. The 
Commission will put forward the necessary proposals as soon as it 
is clear what the future objectives for rates will be as these are 
decisive factors in assessing the risk or extent of distortion.
212. The final element on the VAT side will be the new arrangements for 
treating sales and purchases across borders in the same way as 
those within Member States, with the sale taxable in the hands of 
the vendor and the VAT incurred by the purchaser deductible 
irrespective of the Member State in which it had been charged. The 
only formality which would be required of the taxable purchaser 
would be to include the deductible VAT in the box in his tax return 
which corresponds to his supplier's Member State. A Clearing 
House System would have to be set up between the Member States so 
that the VAT collected in the exporting Member State and deducted 
in the country of import could be credited to the latter. With 
modern information technology such a Clearing House System would 
not demand heavy resources. But it would require mutual confidence 
between Member States' VAT collecting authorities. The Clearing 
House System could be brought into operation before the process 
of rate approximation had been completed. This would achieve a 
decisive simplification for commercial transactions before the 
full new tax structure came into force by the end of 1992.

-  5  3-
Excises
213. In the case of the excises, Council negotiations on the structure 
of the duties on alcoholic drinks are now far advanced, and a 
package solution should be achieved before the end of 1985. Next 
in line, for approval before the end of 1986, will be the excise 
structure for mineral oil products, and the third stage of the 
common cigarette duty structure. The relevant proposals are 
already before the Council. The next step will be for the 
Commission to table proposals for the final stage of the cigarette 
duty structure and for a common structure for the excises on 
other manufactured tobacco. These proposals should in their turn 
be approved in the course of 1987.
214. In framing proposals for common rates it is necessary to look at 
the VAT and excises together. The reason for this is that high 
yields from VAT often tend to be counterbalanced by low yields from 
the excises and vice versa. In short the figures to be adopted for 
the excise rates are dependent to some extent on the rates adopted 
for VAT. The two sets of proposals must be presented together. The 
Commission proposals for excise rate bands will therefore be 
presented alongside the similar VAT proposal during 1986. There 
will be a proposal for a rate band for each of the excises to be 
retained (tobacco products, beer, wine, intermediary products, 
spirits and mineral oil products). These will need to be 
accompanied by a "standstill", whereby Member States would 
undertake to avoid moving away from the common bands.
215. During the subsequent period up to the end of 1992, Member States
will need to carry out the adjustments required to the coverage of 
their excises and the approximation of rates. The changes in
coverage will include the extension or introduction of a wine 
excise in some Member States and the abolition or reduction of all 
excises other than the common ones, where these would create 
distortions in the operations of the Common Market. Examples are 
excises on tradeable goods, such as coffee or tea.
216. Finally, it will be necessary to introduce a system to link 
together the bonded warehouse systems in individual Member States 
in order to allow intra-Community transactions in excised goods to 
take place without frontier controls. Proposals for such a linked 
system will be tabled as the approximation of rates goes forward. 
It will be possible for this to be done separately for each group 
of excises, probably with mineral oils, where present deviations 
are smallest, as the forerunner.
Enforcement
217. It is not, of course, enough simply to pass Community legislation. 
One must also ensure that the rules of the Treaty and of the 
derived legislation adopted under it are implemented and enforced. 
In the fiscal as in the other spheres, pursuit of infringements of 
the existing Community law must go hand in hand with positive 
legislative measures. The Commission has a duty not only to propose 
legislation under Article 99 of the Treaty, but also to seek 
respect of the principles of non-discrimination laid down in 
Article 95. It will continue to carry out that duty as an essential

-  54 -
element of the drive to eliminate all barriers to the completion of 
the Internal Market.
Derogations
218. It has already been made clear in the Introduction to this White 
Paper that the Commission recognises that the approximation of 
indirect taxation will give rise to considerable problems for some 
Member States ; and that as a consequence it may be necessary to 
provide for derogations. There are areas of considerable political 
sensitivity which may have to be accommodated in this way. 
Nevertheless it is in the general interests of the Community that 
such derogations should be kept to the minimum.

-  55 -
CONCLUSION
219. Europe stands at the crossroads. We either go ahead - with 
resolution and determination - or we drop back into mediocrity. We 
can now either resolve to complete the integration of the economies 
of Europe; or, through a lack of political will to face the immense 
problems involved, we can simply allow Europe to develop into no 
more than a free trade area.
220. The difference is crucial. A well developed free trade area offers
significant advantages :  it is something much better than that
which existed before the Treaty of Rome; better even than that 
which exists today. But it would fail and fail dismally to release 
the energies of the people of Europe; it would fail to deploy 
Europe's immense economic resources to the maximum advantage; and 
it would fail to satisfy the aspirations of the people of Europe.
221. The free movement of goods is an important, valuable and possibly 
indispensable step which has to be taken before economic 
integration can be achieved. But it is not the ultimate goal; at 
best it is the indispensable precursor. This philosophy is clearly 
reflected in the Treaties themselves. The Customs Union was the 
first objective of the Treaty of Rome. But that it was by no means 
intended as the last is clearly demonstrated by the fact that what 
the Treaty established was the European Economic Community. The 
preamble to the Treaty starts with the declaration :
- "Determined to lay the foundations of an ever closer union 
among the peoples of Europe, resolved to ensure the eco­
nomic and social progress of their countries by common 
action to eliminate the barriers which divide Europe".
222. Just as the Customs Union had to precede Economic Integration, so 
Economic Integration has to precede European Unity. What this White 
Paper proposes therefore is that the Community should now take a 
further step along the road so clearly delineated in the Treaties. 
To do less would be to fall short of the ambitions of the founders 
of the Community, incorporated in the Treaties; it would be to 
betray the trust invested in us; and it would be to offer the 
peoples of Europe a narrower, less rewarding, less secure, less 
prosperous future than they could otherwise enjoy. That is the 
measure of the challenge which faces us. Let it never be said that 
we were incapable of rising to it.

Annex to the White Paper
TIME TABLE FOR COMPLETING 
THE INTERNAL MARKET BY 1992

CONTENTS
INTRODUCTION
PART ONE :  THE REMOVAL OF PHYSICAL BARRIERSP -  i  *H
I. CONTROL OF GOODS P- 5
1. Various controls
i. Period 1985-1986
ii. Period 1987-1992
2. Veterinary and phytosanitary controls p. 6
i. Period 1985-1986
ii. Period 1987-1992
II. CONTROL OF INDIVIDUALS P- 12
i. Period 1985-1986 
ii. Period 1987-1992
PART TWO :  REMOVAL OF TECHNICAL BARRIERS
I. FREE MOVEMENT OF GOODS
1. New approach in standards policy P- 14
i. Period 1985-1986 
ii. Period 1987-1992
2. Sectoral proposals :  P* 15
2.1. Motor vehicles p. 15
i. Period 1985-1986
ii. Period 1987-1992
2.2. Tractors and Agricultural machines p. 15
i. Period 1985-1986
ii. Period 1987-1992
2.3. Food Law P- 16
,  i. Period 1985-1986
ii. Period 1987-1992
2.4. Pharmaceuticals and high-tech-
medicines P- 17
i. Period 1985-1986
ii. Period 1987-1992
2.5. Chemical products p. 18
i. Period 1985-1986
ii. Period 1987-1992
2.6. Construction and construction p. 19
products
i. Period 1985-1986
ii. Period 1987-1992
2.7. Other items P- 20
i. Period 1985-1986
ii. Period 1987-1992
II. PUBLIC PROCUREMENT P- 21
i. Period 1985-1986
ii. Period 1987-1992

III. FREE MOVEMENT FOR LABOUR A N D  THE PROFESSIONS
i .  Period 1985-1986
i i .  Period 1987-1992p. 23
IV* COMMON MARKET FOR SERVICES
T. Financial Services 
1.1. Banksp. 25 
p. 25i. Period 1985-1986 
ii. Period 1987-1992
1.2. Insurance p. 26i. Period 1985-1986 
ii. Period 1987-1992
1.3. Transactions in securities p. 26i. Period 1985-1986 
ii. Period 1987-1992
2. Transport p. 27i. Period 1985-1986 
ii. Period 1987-1992
3. New technologies and services 
i. Period 1985-1986p. 28
V. CAPITAL MOVEMENTS
i. Period 1985-1986 
ii. Period 1987-1992
VI. CREATION OF SUITABLE CONDITIONS FOR INDUSTRIAL  
COOPERATION ------------ —------
1.
 Company Law
i. Period 1985-1986 
ii. Period 1987-1992
2. Intellectual and industrial property
i. Period 1985-1986 
ii. Period 1987-1992
3. Taxation
i. Period 1985-1986
VII. APPLICATION OF COMMUNITY LAW
1. Transparency
i. Period 1985-1986 
ii. Period 1987-1992
2. Competition policy and state aids
i. Period 1985-1986
PART THREE :  REMOVAL OF FISCAL BARRIERS
I. V.A.T.p. 33i. Period 1985-1986 
ii. Period 1987-1992

EXCISE DUTIES
i. Period 1985-1986 
ii. Period 1987-1992

I .
INTRODUCTION
The Commission's White Paper sets out the essential and logical 
consequences of accepting the European Council's repeated commitment 
to completing the Internal Market by 1992, together with an action 
programme of the measures needed to meet that objective. This Annex 
to the Paper sets out the detailed timetable for implementing the 
Commission's proposed programme.
The timetable is set out in tabular form and is divided into Parts 
which correspond to the Parts of the main body of the Paper. Within 
each Part of the timetable, the specific measures proposed by the 
Commission are separated into two periods, 1985 to 1986 and 1987 to 1992, 
according to the year in which the Commission's proposal will be made. 
However, the timetable for the period 1985 to 1986 also includes 
measures which, though not necessarily mentioned in the body of the 
Paper, have already been proposed to the Council and .remain an essential 
part of the Commission's Programme for completing the Internal Market.
The specific measures set out in the timetable aim to eliminate barriers 
of all kinds (physical, technical and fiscal). They would have an impact 
directly or indirectly, on the lives of all Community citizens and on 
the functions of Community enterprises of all kinds. By 1992, Community 
citizens would for the first time be free to move within the Community 
without systematic checks on their identity or personal belongings; 
goods would be freed of all controls at internal frontiers; Community 
manufacturers would be able to market freely their goods on the basis 
of mutually agreed standards throughout the Community; and enterprises 
would be relieved of the current obstacles to providing cross-border 
services.
Clearly, the Internal Market cannot be completed at a stroke. The 
interim period leading up to 1992 must be put to the best possible use to 
ensure that the adjustments needed to cope with the final dismantling of 
internal frontiers are not too abrupt. Progress towards the objective 
needs to be discernible at an early stage, and will be so,provided that 
the proposed timetable is respected.
When will Community citizens and enterprises see tangible evidence of the 
effect of the measures proposed? The following milestones along the path 
to completion of the Internal Market give some indication of the progress 
and benefits the Commission would wish to see.
Fpr Community citizens, and in particular, travellers, the first evidence 
would be the further easing of border controls and the introduction of 
increased duty free allowances by 1986; by 1988, checks on individuals 
leaving one Member State for another would be eliminated; and by 1992, 
all systematic checks on the movement of citizens within the Community 
would disappear.
As far as the control of goods is concerned, controls on the amount of 
fuel carried by commercial road vehicles would be abolished by 198S; 
controls on transport authorisations wil-l- be eliminated by 1986; by 1988 
veterinary controls will be limited to places of departure and controls 
on veterinary and plant health certificates to the places of destination;

II.
also b y  1 9 8 8  controls of road transport quotas w ould be abolished; 
b y 1992, further harmonisation of veterinary and plant health standards 
and the use of the C o m m u n ity  health m ark  for animal products w ould 
eliminate the need for frontier controls.
C o m m u n ity  manufacturers w ould benefit progressively between n o w  and 
1992 from  the Commission's proposed n e w  approach to technical harmonisation 
and standards policy and from  the approximation of national laws. T h e  
Commission's specific proposals will cover a  very w ide range of products, 
such as m otor vehicles, tractors and agricultural machines, food, chemical,
'  l  and pharmaceutical products. Progress 
towards the elimination of barriers to trade will vary from  sector to 
sector, but in the pharmaceutical sector, for example, all obstacles to 
the free circulation of pharmaceutical products w ould be rem oved b y 1990.
Further benefits to C o m m u n ity  manufacturers and suppliers will accrue 
from  the opening u p  of tendering for public contracts. B y  1988, four 
major sectors (energy, transport, water and telecommunications) w ould 
be included in the system of prior information and publicity.
In the financial services field, greater freedom  to provide services in 
insurance.other than life insurance w ould be achieved as early as 1986; 
by 1989, there w ould be freedom  to supply services in the m otor liability 
insurance sector; and b y 1991, obstacles to the supply of life insurance 
w ould be eliminated.
Early evidence of progress w ould be seen in the transport sector. T h e  
freedom  to provide sea transport services between the M e m b e r States w ould 
be established b y the end of 1986; there w ould be similar achievements 
in the airtransport sector b y 1987 and in the road transport of goods 
sector by 1988. T h e transport of passengers b y  road w ould be 
liberalised b y  1989.
Significant landm arks in harmonising intellectual and industrial property 
law s w ould be the creation in 1987 of a  C o m m u n ity  Trade M a rk  and the entry 
into force in the sam e year of the L uxem bourg Convention o n the C o m m u n ity  
Patent.

TIMETABLE FOR COMPLETING
THE INTERNAL MARKET BY 1
- T h e  present time table has been draw n u p in such a  w a y  as to allow at 
least one year for the M e m b e r States to im plem ent the m easures 
concerned.
- Asterix denotes existing proposals mentioned in last years 
consolidation p rogram m e C 0 M (8 4 )3 0 5  final of 13.6.1984.
- T w o  asterixs denote proposals m a d e  after presentation of consolidation 
program m e.
PART ONE :  THE REMOVAL OF PHYSICAL BARRIERS
I. CONTROL OF GOODS
Subject D o c  nu D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
1. Various controls  
PERIOD 1985-1986
Simplification of C o m m u n ity  transit 
procedure :  discontinuance of presen­
tation of transit advice note and 
guarantee*C 0 M (7 9 )4 5 6 1 9 7 9 1 9 8 6
D uty free admission of fuel contained 
in the fuel tanks of com m ercial m otor 
vehicles*" C O M  (84) 1 7 1 1 9 8 4 1 9 8 5
R o ad  transport :  Abolition of control 
of quotas at border crossings1 9 8 5 1 9 86
Transport of travellers :  aboli­
tion of border controls related to 
transport authorisations1 9 8 5 1 9 8 6
Period 1985-86 lists existing proposals (one or tw o  asterixs) to be 
adopted b y  the Council within this period and n e w  proposals to be 
presented in 1 9 8 5  and 1986. “

- 6 -
S U B J E C T  Doc.n“ D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
♦♦Accession of Spain and Portugal : A c t of
technical adaptation legislation
85-86
♦Single Administrative D o cu m en t (S A D )  C 0 M (8 2 ) 4 0 1 1 9 8 5 1 9 8 5
follow u p
Introduction of c o m m o n 1 9 8 6 1 9 86
border posts ("banalisation")
Abolition of custom s presentation
charges 1 9 8 5 1 9 8 6
P E R IO D  1987-1992
Com pletion of w o rk  leading to
full abolition of all remaining
import formalities and controls
o n  goods betw een M e m b e r States :
- statistical harmonisation 1 9 8 7 19 9 0
- elimination of all national
protective measures and all
regional quotas, in line with
the C om m unity's com m ercial policy 1 9 8 9 1 9 8 9
- T a x  approximation o n
V .A .T. and excise duties (see 1987- 1988-
Part Three). 1 9 8 9 1 9 90
2. Veterinary and phytosanitary controls
P E R IO D  1985-1986
- live animals of the bovine species: 1 9 8 5 1 9 8 6
am en d ed  eradication directives to provide 
for final eradication of tuberculosis, 
brucellosis and leukosis in all M e m b e r 
States including Portugal and Spain
- live animals of the porcine species :  19 8 6  1 9 87
modify, intensify and prolong Directives
o n  eradication of classical sw ine 
fever in the C o m m u n ity  as a  w hole and of 
African sw ine fever in Sardinia, Spain an d  
Portugal
- creation of a  special veterinary fund to 1986 19 8 7
finance the above mentioned eradication
program m es and provide financial assistance 
in relation to control and eradication 
of other diseases w hich m a y  arise

- 7  -
S U B J E C T D oc.n° D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  C ounci l
- production and trade in milk* C O M (71)64+ 
C 0 M (7 1 )1012+  
C O M (72)8841 9 7 1 1 9 8 5
- production and trade in medicated 
feeding stuffs* C 0 M (8 1 )7 9 5 1 9 8 1 1 9 8 5
- horm one grow th promoters C O M (84)295 1 9 8 4 1 9 8 5
- microbiological controls (m eats 
poultry, red meat)* C O M (81)500+ 
C 0 M (8 4 )4 3 91 9 8 1 1 9 8 5
- boar m eat* C O M (83)655 1 9 8 3 1 9 8 5
- medical examination of personnel* C O M (84)337 1 9 8 4 1 9 8 5
- personnel responsible for inspection* C O M (81)504 1 9 8 1 1 9 8 5
- m inced m eat and similar ~ m s --------- -
- 
antibiotic residues* C O M (81) 1 9 8 1 1 9 8 5
“ control of residues** C 0 M (8 5 )1 9 2 1 9 8 5 1 9 8 5
- pedigree of bovine animals* C O M (79)649 "T979 ~ m ë ------------
- 
pedigree of porcine animals 1986
- imports of m eat products from  
third countries (animal and public 
hea1th) C 0 M (8 4 )5 3 0 1 9 8 4 1 9 86
- swine fever C O M (84)900 1 9 8 4 1 9 8 5
~  control of foot and m outh disease C O M (82)
+  C 0 M (8 3 )5 8 41 9 8 5
- Aujesky disease and sw ine 
vesicular disease C 0 M (8 2 )5 2 9
- sem en  of animals C O M (8 3 )5 1 2 1 9 8 3 1 9 8 5
- modification of Directives 
72/461/E E C  and 72/462/E E CC 0 M (8 4 )5 0 0 1 9 8 4 1 9 8 5
- modification of Directive 77/99/E E C  
o n  m eat products1 9 8 5 1 9 8 6
- first revision of the safeguard
clause concerning the veterinary sector: 
the exporting M e m b e r State takes
the appropriate measures subject to C o m m u n ity  decision 1 9 8 6 1 9 87

-  8 -
S U B J E C T  ~ Doc.nB  D ate of Expected
C o m m is- date for
sion's adoption
proposal b ÿ  Council
- formulation of directives concerning 
animal health problem s relating to 
trade in :
. live poultry, poultry m eat and 
hatching eggs 
. dogs and cats1 9 86 1 9 87
- live animals of the bovine and porcine 
species :  am e n d  Directive 64/432 to pro­
vide for inspection and certification in 
herd of origin and, w h e n  necessary, re­
inspection at place of destination1 9 86 1 9 8 7
- products of animals of the bovine an d  
porcine species and of poultry; am en d  
Directives 72/461/EEC, 80/215/E E C  and 
71/118/E E C  to provide for inspection 
and certification at the place 
of production and re-inspection, 
in the case of suspicion of 
fraud at the place of destination1 9 8 6 1 9 8 7
- reinforcement of C o m m u n ity  checks of 
application b y  on-the-spot C om m ission 
inspectors; budget proposal19 8 6 1 9 8 7
- reinforcement of arbitration of 
di sputes 1 9 8 6 1 9 8 7
- application of a  C o m m u n ity  veterinary 
action p rogram m e to control 
irregularities and fraud in the 
m o v em en t of animals and animal 
products1 9 86 19 8 7
- modification of the rules of frontier 
controls relating to welfare of 
animals in international transport in 
order to realise the free circulation1 9 8 6 1 9 8 7
Proposal to am en d  Directive 77/93
(plant health)* C 0 M (8 4 )2 8 8 1 9 8 4 1 9 8 5
Definition of role of C o m m u n ity  
plant health inspectorate 
(am ending Directive 77/83) 1 9 8 5 1 9 8 6
A m en d m en ts to Art. 1 5  of Directive 
77/93 (improvem ents to the 
operation of safeguard provisions) 1 9 8 5 1 9 86

9  -
S U B J E C T
tD oc.n° D ate of 
C o m m is­
sion' s  
proposalExpected 
date for 
adoption 
b y  Council
Further alignment of additional 
plant health standards set u p  
b y M e m b e r States in respect 
of third country
products (am ending Directive 77/93) 1 9 8 5 1 9 86
B udget proposal enabling establishment 
of C o m m u n ity  plant health inspecto­
rate 19 8 6 1 9 87 B udget
Proposal for a  Directive concerning 
the fixing of guidelines for the 
evaluation of additives used in 
animal foodstuffs 1 9 8 6 1 9 8 7
Proposal for fixing m a x im u m  levels 
for pesticide residues in foodstuffs 
of animal origin* C O M (80)14 1 9 8 0 1 9 8 5
Proposal for fixing m a x im u m  levels 
for pesticide residues in feeding- 
stuff s* C 0 M (7 7 )37 7 1 9 7 7 1 9 8 6
Proposal for the modification of 
directive 76/895/E E C  (m a x im u m  
levels for pesticide residue in 
fruit and vegetable) 1 9 8 6 1 9 87
Proposal to am en d  the annex of 
directive 76/895/E E C  concerning 
residues of pesticides in and o n  
fruit and vegetables (ethoxyquin 
and diphenylamine)* C O M (82)883 1 9 8 3 1 9 8 5
Proposal to am en d  directive 79/117 
o n  the prohibition of certain 
plant protection products (ethylene 
oxide)* C O M (82)712 1 9 8 2 1 9 8 5
Proposal for the placing of plant 
protection products o n  the market* C O M (76)427 1 9 76 1 9 8 6
Proposal for the im provem ent of 
C o m m u n ity  systems of certification 
of seeds1 9 8 5 1 9 8 6
Proposal for a  system  of certification 
of reproductive materials in fruit 
plants19 8 6 1 9 8 8
Proposal for 4  years research program m e 
into effective m ethods of controlling 
certain harmful organisms1 9 8 6 1 9 8 7

-  10 -
S U B J E C T  D oc.n" D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
P E R I O D  1987-1992
- live animals of the bovine species 
formulate directives for eradiction 
of contagious bovine pleuro­
pneum onia in Portugal and Spain 
and for B lue T o n g u e 
o n  G reek Islands1 9 8 7 1 9 8 8
- em bryos of farm  animals :  Directive 
for trade 1 9 8 7 1 9 8 8
- formulation of Directives concerning 
animal health problem s relating 
to trade in:
. live animals of equine species 
. live animals of bovine and 
caprine species 
. live fish and fish products1 9 8 7 1 9 8 8
Proposals limiting inspections to 
places of departure and proposals 
concerning the checking of plant health 
certificates at the places of 
destination1 9 8 7 1 9 88
- establishment of certain rules 
of liability in respect of plant 
health1 9 8 7 1 9 8 8
- brucellosis in small ruminants 1 9 8 8 1 9 8 9
- echninocolissis 1 9 8 8 1 9 8 9
- formulation of directives 1 9 8 8 19 8 9
concerning veterinary inspection 
problems relating to trade in 
animals and animal products 
not covered b y  existing 
Directives
- harmonised health conditions 
for production and trade in :
. shellfish and crustaceare and 
preparation
. fish and fish products 
. g a m e  meat, products and preparations1 9 88 1 9 8 9  
1 9 8 8  19 9 0  
1 9 8 8  1 9 9 0
- pedigree animals not covered b y  
existing Directives 1 9 88 1 9 8 9

-  11
S U B J E C T  Doc.n0  D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
- simplification of annexes in Directive
77/93 (plant health) 1 9 8 9  1 9 9 0
- alignment of national standards and
intra-Community standards in plant health 1 9 89 1 9 9 0
- reduction in role of
phytosanitary certificate 1 9 90 1 9 9 1
in intra-Community trade
- proposal for a  system of certification 
in reproduction materials for
decorative plants 1 9 89 1 9 9 0
harmful organisms especially 1 9 8 7  1 9 8 9
in seed potatoes and in fruit 
plant reproductive material
Revision of labelling rules for 
food, draw n u p  in view  of a  uniform
E E C  label 1 9 8 7  1 9 8 8
Guidelines for checking requirements 1 9 8 7  1 9 8 8
in connection with the approval of 
plant protection production
- extension of application — —
Directives 66/401/EEC,
70/437/EEC  and 70/458/EE C  seedlings 1 9 87 1 9 8 8
- proposal for creation of a  ~  1987 1 8 7 7
European la w  o n  plant breeders
- harmonisation of control of ~
foot and m o u th  disease 1990 1992
- harmonised health conditions for ~~ Ï 99Ô  Ï992T
production and trade in food products
of animal origin not covered b y  
existing legislation e.g.
- second revision of the safeguard 1991 1992
clause concerning the
veterinary sector:
the exporting M e m b e r State
takes the appropriate measures in
order to avoid specific measures in
intra-Community trade.
- pathogens in feedingstuffs 1 9 9 1  1 9 9 2

-  12  -
S U B J E C T Doc.nu D ate of 
C o m m is ­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
- application of health standards to 
national products1 9 9 1 1 9 9 2
- suppression of veterinary certificates 
of animal products and simplification 
of certificates for live animals.1 9 9 1 1 9 9 2
- suppression of plant health certificates 1 9 9 1 1 9 9 2
II. CONTROL OF INDIVIDUALS
PERIOD 1985-1986
Sixth Directive relative 
to exemptions in international 
travel :  increase to 400 E C U * C O M (83)117 1 9 8 3 1 9 8 5
Seventh Directive relating to 
exemptions in international travel :  
tax-free sales*C 0 M (8 3 )1 6 6 1 9 8 3 1 9 8 6
T ax  reliefs to be allowed o n  the 
importation of goods in small 
consignments of a  non-commercial 
character* C O M (83)730 1 9 8 3 1 9 8 5
Directive o n  the easing of 
controls at intra-Community 
Borders**C O M (8 5 )2 2 4  
C O M (85)749 1 9 8 5 1 9 8 5
Directive o n  the approximation 
of arm s legislation 1 9 8 5 1 9 8 8
Directive concerning abolition of 
police controls w h e n  leaving one 
M e m b e r State to enter 
another (intermediary stage) 1 9 8 6 1 9 8 8
PERIOD 1987-1992
Directive o n  the approximation 
of drugs legislation 1 9 8 7 1 9 8 9
Directive o n  the coordination 
of rules concerning the status of 
third country nationals. 1 9 88 1 9 90
Directive o n  the coordination 
of rules concerning the right of asylum  and the status of
refugees 1 9 8 8 1 9 9 0

- 1 3  -
S U B J E C T  D oc.n° D ate of Expected
C o m m is- date for
sion's adoption
proposal b y Council
Directive o n  the coordination
of national visa policies 19 8 8  1 9 9 0
Directive o n  the coordination 
of rules concerning extradition 19 8 9  1 9 9 1

- 1 4  -
'SÜË'X eCT Doc.nu  D ate ' 0? Expected
C o m m is- date for
si on's adoption
proposal b y  Council
PART TWO :  THE REMOVAL OF TECHNICAL BARRIERS  
I. FREE MOVEMENT OF GOODS
1. New approach in technical harmonisation and standards policy  
PERIOD 1985-1986
Proposal for the extension 
of information procedures 
o n  standards and technical rules (am endm ent 
of directive 83/189/EE C )1 9 86 1 9 8 7
Standardisation in the
advanced manufacturing equipm ent
sector 1 9 8 6N o  formal
decision
needed
Certification :  index of bodies 1 9 8 6 N o  formal 
decision 
of the 
Council 
needed
1 9 8 6  In principle
n o  formal 
decision 
of the Council 
neededRecognition of tests and certificates
- specific index of bodies 1986 N o  formal
- Eurocodes :  adoption of E C 1 , decision
E C 2 , E C 3  and E C 8 of the
- Recognition of tests and Council
decisions neededConstruction sector :
PERIOD 1987-1992
Proposals to be m a d e  for m achine 
safety, pressure vessels, road 
m aking equipment, 
electrical interferences, lifting 
equipment in order to im plem ent
the n e w  approach 19 8 7  1987-1988
Electromedical equipm ent 1988 1 9 8 9

- 1 5  -
S U B J E C T  D oc.n" D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  C o u n c  il
2. Sectoral proposals concerning approxistation of laws
2.1. M otor vehicles
P E R IO D  1985-1986
- gaseous emissions passenger
cars
- gaseous emissions
- diesel particulates
- speed limits
- revision of fram ew ork 
Directive 70/156/EE C
- revision of breaking Directive1 9 8 5
1 9 8 5
1 9 8 5
1 9 8 5
1 9 8 6
1 9 8 61 9 8 5
19 8 6  
1 9 8 6
1 9 86
1 9 8 7
n o  decision 
needed
PERIOD 1987-1992
Revision of European test procedure 
for gaseous emissions1 9 87 19 8 7
Revision of limit values for gaseous 
emissions of cars below  14 0 0  c c1 9 87 1987
Global assessment of protective 
characteristics of passenger cars 
in frontal and lateral im pact1 9 8 7 1 9 88
Implementation of E E C  type approval 
schem e for other m otor vehicles (buses 
and coaches, motorcycles)1 9 8 9 1 9 90
Adaptation of existing C o m m u n ity  
Regulations.  1987-90 N o  decision 
needed
2.2 Tractors and Agricultural m achines
P E R IO D  1985 to 1986
Implementation Directive 74/150/E E C  
(weight and dimensions, driveshaft, 
engine stopping device, windscreen wipers 
foot rest)1 9 86 19 8 7

- 1 6  -
S U B J E C T Doc.n 0 D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adopt i o n  
b y  Council
P E R IO D  1987-1992
Adaptation of existing C o m m u n ity  
Regulations1987-90 N o  decision 
needed
2.3. F o o d  law
P E R IO D  1985-1986
General Directive o n  food additives 
(in part modification of existing 
di rectives)1 9 8 5 19 8 6
General Directive o n  materials an d  
articles in contact with food (am endm ent)1 9 8 5 19 8 6
General Directive o n  food for particular 
nutritional uses (am endm ent)1 9 8 5 1 9 8 6
General Directive o n  food labelling 
(am endm ent)T 9 8 5 1 9 8 6
General Directive o n  food inspection 1 9 8 6 1 9 87
General Directive sampling and m ethods 
of analysis C O M (84)39 1 9 8 41 9 8 5
General Directive o n  quick frozen food
C 0 M (8 4 )4 8 9 1 9 8 41 9 8 5
M an ag em en t of existing vertical 
Directives (procedure)1 9 8 5 1 9 86
Flavourings* C 0 M (8 0 )2 8 6  
C 0M (82)1 6 6 1 9 8 0 1 9 8 5
Extraction solvents* C 0 M (8 3 )6 2 6
C 0 M (8 5 )7 9 1 9 8 3 1986
Preservatives* 
(m o d i fi cati o n )
C 0 M (8 1 )7 1 2 1 9 8 1 1 9 8 5
Emulsifiers (modification) C O M (84)4 1 9 8 4 1 9 8 5
Infant formulae and follow-up m ilk 
(dietetic foods)*C O M (84)703 1 9 8 4 1 9 86
C o co a and chocolate consolidation* T Ü M T 5 3 T 7 8 7 T 9 8 4------- - - - -T 9 3 5-------

- 1 7  -
S U B J E C T Doc.n 0 D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
Coffee extracts chicory extracts 
(modification)C 0 M (8 4 )1 3 8 1 9 8 4 1 9 8 5
Obligation to indicate ingredients 
and alcoholic strength*C 0 M (8 2 )6 2 6 1 9 8 2 1 9 8 5
C laim s in the labelling of foodstuffs* C O M (81)159 1 9 8 1 1 9 8 5
Simulants (plastic materials in contact 
with foodstuffs)*C O M (84)152 T 9 8 4 1 9 8 5
M odified starches* C O M (84)733 1 9 8 4 1 9 8 6
l-ruit Juices etc... (modification) 1 9 8 5 1 9 8 6
Jam s etc (Modification) 1 9 8 5 1 9 86
Proposal for a  Directive am ending 
Directive 79/581/E E C  
o n  consum er protection in the 
indication of the prices 
of foodstuffsC O M (84) 2 3 1 9 8 4 1 9 8 5
P E R IO D  1987-1992
uenerai Directive o n  irradiation 
of foodstuffs19 8 7 1 9 88
General Directive o n  n e w  foodstuffs 
obtained b y  a  biotechnological process1 9 8 7 19 8 8
Additional labelling requirements 
(Nutrition labelling)1 9 8 9 1 9 90
Adaptation of directives o n  technical progress 1987-1989 1988-1990
2.4. Pharmaceuticals and high-technology medicines 
P E R IO D  1985-1986
rroposais T o r Directive concerning 
the placing o n  the market of high- 
technology medicinal products incl. 
those derived from  biotechnology*C O M (84)437 1 9 8 4 19 8 6
Proposal am ending Directive 75/318/E E C  
concerning the testing 
of medical specialitiesId em 1 9 8 4 1 9 8 6

-  18  -
S U B J E C T Doc.nu D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y Council
Proposal am ending Directive 81/852/E E C  
concerning veterinary medicinal 
productsId e m 1 9 8 4 1 9 86
Proposal for a  Council R ecom m endation 
concerning tests relating to the pla­
cing o n  the market of medical 
specialitiesId em 1 9 8 4 1 9 86
Proposal for a  Council Directive 
am ending Directive 65/65/E E C  
concerning medical specialitiesId em 1 9 8 4 1 9 86
Price transparency in prices of 
medicines and social security refunds1 9 8 6 1 9 88
M em bership of the European Pharm aco­
peia 1 9 8 6 1 9 8 7
P E R IO D  1987-1992
Extension of Directives to medicinal 
products not already included1 9 8 7 1989
A m e n d m e n t to the Directive o n  
veterinary medicines19 8 7 1 9 8 9
Pharmaceutical products :
- completion of w o rk  eliminating 
obstacles to free circulation of 
pharmaceutical products19 8 9 1 9 90
Harmonisation of condition 
of distribution to patients 19 9 0 1 9 9 1
Information of doctors and patients 1 9 9 0 1 9 9 1
2.5. Chem ical products
P E R IO D  1985-1986
Council Directive relating to 
restrictions o n  the marketing 
and use of P C B s  (polychlorinated 
biphenyls) C O M (84)513 1 9 8 4 1 9 8 5
Council Directive relating to 
"Restrictions o n  the marketing and 
use of asbestos"“C O M I  79) 41 9  
C 0 M (83)5561 9 7 9
1 9 8 31 9 8 5

- 1 9  -
S U B J E C T D oc.n° D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
C om m ission Directive adapting the 
Directive 67/548/E E C  "D angerous 
substances" 1 9 8 5N o
decision
needed
C om m ission Directive relating 
to " A m m o n iu m  nitrate" 1 9 8 5N o
decision
needed
Non-ionic detergents (modification 
of the existing directive) C O M (85)217 1 9 8 5 1 9 86
Classification, packaging and 
Labelling of dangerous preparations 1 9 8 5 1986-1987
M em bership of the European 
A greem ent o n  detergents C O M (85)63 1 9 8 5 1 9 86
Liquid fertilizers 1 9 8 6 1 9 88
P E R IO D  1987-1992
Secondary fertilizers 1 9 87 19 8 9
- Oligo-elements in fertilizers 1 9 88 19 9 0
- M eth o d  of analysis for secondary 
fertilizers and oligo-elements 1 9 8 9 1 9 9 1
2.6. Construction and construction products
P E R IO D  1985-1986
Directive o n  safety of buildings 
(resistance to earthquakes, other 
accidental dam age, prevention of 
progressive collapse) 1 9 8 5 1 9 86
Directive o n  reliability (fitness for 
purpose) and durability of buildings 
(responsibility of designers, builders) 1 9 8 5 1 9 86
Directive on test m ethods for 
reaction to fire and resistance 
to fire of building materials 
and com ponents 1 9 86 1 9 8 6

-  20  -
S U B J E C T D oc.n" D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
Directive to prohibit the introduction 
of n e w  or modified building regulations 
at local governm ent levels for a  period 
of 5  years 1 9 8 5 1 9 8 6
Revolving cranes 1 9 7 8 1 9 86
P E R I O D  1987-1992
Revision of Directives o n safety 
reliability and durability of 
buildings in light of n e w  Eurocodes 
E C  4, 5, 6, 7-
1 9 8 8 1 9 8 9
Directive o n  fire safety in public 
buildings and hotels 1 9 7 8 1 9 8 8
Directive o n insulation products 
(protection of health of building 
workers and occupants). 1 9 8 7 1 9 8 8
D evelopm ent and introduction of a  M o d e l 
C o d e  for building regulations (based o n  
U N - E C  m odels) 1 9 9 0 1 9 9 2
Directive o n  safety and reliability of 
special structures (masts, towers, long 
bridges, drilling platforms, water- 
retaining structures) 1 9 9 0 1 9 9 2
2.7 Other iteas
P E R IO D  1985-1986
Household appliances :  airborne noise* C 0 M (8 1 )8 1 1 1 9 8 1 1 9 8 5
Safety of toys* C O M (83)323 1 9 8 3 1 9 8 5
M easuring instruments and m ethods of 
metrological control :  electronic 
devices (am ending 71/316/EEC )
- tyre pressure gauge
- carbon m onoxide m easurem entC O M (78)766
C O M (8 0 )8 5 0
C O M (8 0 )8 5 01 9 7 8
1 9 8 0
1 9 8 019 8 6
1 9 8 5
1 9 86
C hem ical properties of toys 1 9 8 5 1 9 86
Proposal for a  Council directive 
o n  electrical toys 19 8 6 1 9 8 7
Hydraulic diggers (noise) 5.10.81 1981 ~ i m ---------

-2 1 -
S U B J E C T D oc.n° D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
Protection of hotels against 
fire (proposal for a  reco m m en ­
dation) 21.2.84 1 9 8 4 1 9 8 6
M etrology certification T 9 8 6 1 9 8 8
Individual protective devices 
equipment:
. helmets for motorcycle 
drivers (result of notification 
o n  the basis of 189/83 directive) 
. safety boots and shoes (idem )19 8 6
1 9 8 61 9 87
1 9 87
Proposal for a  revision of Chapter 
6 of the E uratom  Treaty concerning 
nuclear materials C O M (84)606 1 9 8 4 1 9 87
Proposal for a  Directive o n  
consum er protection in 
respect of the indication of 
pri ces
for non-food productsC 0 M (8 3 )7 5 4 1 9 8 3 1 9 8 5
General Council Directives o n  cos­
metics (am endm ent) 1 9 8 6 1 9 8 8
P E R IO D  1987-1992
Proposal for general Directive 
in textiles 1 9 8 7 1 9 8 8
Proposal for a  Directive o n  
flammability 1 9 8 8 1 9 8 9
Individual protective devices :
- eye protective devices
- respiratory protective devices
- industrial safety belts
- protective clothing1 9 8 7
1 9 8 8
1 9 8 8
1 9 8 91 9 8 8
1 9 90
1 9 90
1 9 9 1
M etrology completion of w o rk 1 9 8 7 1 9 89
II. PUBLIC PROCUREMENT  
PERIOD 1985-1986
Im provem ent of Directives 
o n  public procurement 19 8 5  1 9 87

-  22  -
S U B J E C T  Doc.nu D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adopt i o n  
b y  Council
P E R IO D  1987-1992
Im provem ent of Directives o n  public 
procurement1 9 8 7 1 9 88
Extension of Directives to excluded 
sectors - telecommunications and energy1 9 8 7 1 9 8 8
Public procurement in the field of 
services ; opening u p  of markets for 
priority sectors1 9 8 7 1 9 8 9
Public w o rk  procurement :  additional 
harmonisation of procedures1 9 8 9 1 9 9 0
Public procurement of services :  
other sectors1 9 8 9 1 9 9 1
Extension of Directives to excluded sectors: 
electricity or water1 9 8 9 19 9 0
Implementation of Directives 
1990-1992

-23. -
S U B J E C T  ------------------------- - ‘ W ^ ’ ·  ExpectedC o
m m is- date for
sion's adoption 
proposal b y  Council
III. f r e e m o v e m e n t  f o r l a b o u r  a n d t h e pr o fessio n s
P E R IO D  1985-1986
Proposal allowing the 
elimination of remaining 
obstacles related to the 
m o v em en t and residence of migrant 
C o m m u n ity  workers**
Proposal concerning the 
harmonization of incom e taxation 
provisions with respect to 
freedom  of m o v em en t for workers 
within the C o m m u n ityC O M (85)48 
Final 1 9 8 5 1 9 87
C 0 M (7 9 )7 3 7
Final 1 9 79 1 9 8 5
Proposal concerning the 
comparability of vocational 
training-qualifications
Proposal for the development of 
cooperation program m es betw een 
M e m b e r States for apprentices 
undergoing vocational trainingC O M (83)482 
C 0 M (8 4 )4 0 61 9 8 3
19 8 41 9 8 5
Proposals for promoting 
student mobility and coopera­
tion between further education 
establishments in different 
M e m b e r States 1 9 8 5  1 9 8 6
T986 ÎWT
Proposal for the developm ent
of youth exchanges in
the C o m m u n ity  including
young people in vocational training and
voluntary w o rk  abroad. 1 9 8 5 1986
Proposals for cooperation betw een 
higher education and industry 
for advanced training relating to 
n e w  technologies ( C O M E T T ) 1 9 8 5 1 9 8 6
Proposal for a  Directive 
concerning transitional measures 
for access to activities in the 
technical field and 
for their exercise* C 0 M (6 9 )9 3 4 1 9 6 9 1 9 8 5
Proposal for a Directive 
concerning the coordination 
of provisions in respect of training of engineers*C O M (69)934 1 9 6 9 1 9 8 5

- 2 4  -
S U B J E C T D oc-n° D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
Proposal for a  Directive 
o n  the coordination relating to 
com m ercial agents*C 0 M (7 6 )6 7 0  
C O M (78)7731 9 7 6
1 9 7 8 1 9 8 5
Proposal for a  Directive 
concerning the coordination 
of provisions in respect of 
certain activities in the 
field of pharm acy* C O M (81)4 1 9 8 1 1 9 8 5
A m e n d e d  proposal for a  
Directive concerning the 
m utual recognition of 
diplomas in pharm acy** C O M (84)15 1 9 8 4 1 9 8 5
Proposal for a  Council 
Directive o n  specific training 
in general medical practice** C 0 M (8 4 )6 5 4 1 9 8 4 1 9 8 6
Right of Establishment:
Proposal for a  Directive setting 
u p  a  general system of m utual 
recognition of higher 
education diplomas 1 9 8 5 1 9 87
Right of residence for nationals 
of M e m b e r States not yet 
or n o  longer em ployed* C O M (79)215 
C 0 M (8 Q )3 5 8  
C O M (80)6491 9 7 9 1 9 8 5
P E R IO D  1987-1992
Proposal concerning the elimination 
of cum bersom e administrative pro­
cedures relating to residence permits 1 9 8 7 1 9 8 8
Proposal concerning the introduction 
of a  European "vocational training 
card" proving the qualification of its 
holder 1 9 8 9 1 9 90
Assessm ent o n the functioning of 
the general system  of m utual reco­
gnition and eventual proposal in order 
im prove itto
1 9 9 0 1 9 9 1

- - 2 5  ~
" S U B J E C T  Doc.n 0 D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
IV. C0B80M MARKET F O R  SERVICES
1. FINANCIAL SERVICES
1.1. Banks
PERIOD 1985-1986
Proposal for a  Directive 
o n  the accounts of banks C O M (81)84 
C 0 M C 8 4 )1 2 4 1 9 8 4 1 9 8 7
Proposal for a  Directive 
o n  the accounts of foreign 
branches of banks 1 9 8 5 1 9 87
Proposal for a  Directive 
o n  the freedom  of establishment 
and the freedom  to supply 
services in the field of 
mortgage credit C O M (84)730 1 9 8 5 1 9 88
Proposal for a  Directive o n  
reorganisation and winding-up of 
credit institutions 1 9 8 5 1 9 8 7
Proposed R ecom m endation o n  
the harmonization of 
the concept of o w n  funds 1 9 8 5 1986
Proposed R ecom m endation o n  the 
establishment of a  guarantee 
system of deposit within the 
C o m m u n ity 19 8 6 1 9 8 7
Proposed R ecom m endation o n  the 
control of large exposures b y  
credit institutions 1 9 86 1 9 8 8
PERIOD 1987-1992
Proposal for a  Second Directive 
o n  coordination of credit institutions 1 9 87 19 8 9

- 2 6 -
S U B J E C T Doc.n“ D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
1.2. Insurance 
P E R IO D  1985-1986
proposal tor a  Directive 
to facilitate freedom  to provide 
services in insurance other than 
life insuranceC 0 M (7 5 )5 1 6  
C O M (78)63 1 9 7 8 1 9 8 6
Proposal for a  Directive o n  
coordination of law s relating to 
legal expenses insuranceC 0 M C 7 9 J3 9 6  
C O M (82)43 1 9 7 9 1 9 8 7
Proposal for a  Directive 
concerning credit insuranceC 0 M (7 9 )4 5 9
C 0 M (8 2 )2 5 5 1 9 7 9 1 9 8 8
Proposal for a  Directive 
o n  insurance contracts C O M (79)355
modified
C 0 M (8 0 )8 5 41 9 7 9 1 9 88
Proposal tor a  Directive concerning 
the winding-up of insurance com panies 1 9 8 6 19 8 9
Proposal for a  Directive o n  the 
accounts of insurance 
undertakings1 9 8 6 1 9 8 9
Proposal for a  3rd Directive 
concerning m otor liability insurance 1 9 8 6 1 9 89
P E R IO D  1987-1992
rroposai tor a  Directive o n  
freedom  to supply services 
in the m otor liability 
insurance sector1 9 8 7 1 9 8 9
Proposal for a  Directive for 
freedom  to supply services 
in the field of life insurance1 9 87 1 9 9 1
1.3. Transactions in securities
P E R IO D  1985-1986
Proposal for a  Directive for the 
coordination of laws, regulations, 
and administrative provisions 
regarding collective investment 
undertakings for 
transferable securitiesC 0M (76)1 5 2  
C 0 M (7 7 )2 2 7 1 9 7 6 1 9 8 5

- 2 7  -
S U B J E C T Doc.n 0 D ate of 
C o m m is­
sion' s 
proposalExpected 
date for 
adoption 
b y  Council
Proposal for a  Directive 
concerning information to be 
published w h e n  m ajor holdings 
in the capital of a  listed 
co m p an y  are acquired or disposed of 1 9 8 5 1 9 88
Proposal for a  Directive coordinating 
the requirements for the drawing up, 
scrutiny and distribution of the 
prospectus to b e published 
w h e n  securities are offered for 
subscription or sale to the publicC O M (80)893 
modified 
C O M (82)4411 9 8 1 1 9 8 8
P E R IO D  1987-1992
Proposal for a  Directive 
concerning investment advisors 19 8 7 1 9 8 9
2. T R A N S P O R T
P E R IO D  1985-1986
(see control 
of goods)
R o a d  transport, abolition 
of border controls related 
to transport authorisations.
★Air transport :  fares C O M (81)396 
C 0 M (8 4 )7 21 9 8 1 1 9 8 5
★Air transport :  bilateral agreements, 
arrangements and m em o ran d a of under­
standing between M e m b e r States C O M (84)72 1 9 8 4 1 9 8 6
★Air transport :  application of 
Article 8 5  E E C C 0 M (8 4 )7 2 1 9 8 4 1 9 8 7
★C om m unity quota for the carriage of 
goods b y road betw een M e m b e r States :  
final stageC O M (83)340 
R E G  3621/841 9 8 3 1 9 86
1 9 88
★Access to the inland w aterw ay freight C 0 M (6 7 )7 2 2  19 6 7  1989
market
★Non-resident carriers :  national C 0 M (82)816 1 9 8 2  1 9 88
transport services

-28 -
S U B J E C T D oc.na D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
♦Maritime transport (freedom  to 
provide services in the 
sea transport sector) C O M (85) 9 0 1 9 8 5 1 9 86
Liberalisation of coach services T $ 8 5 ---------
3.
 N E W  T E C H N O L O G I E S  A N D  S E R V IC E S
P E R IO D  1985-1986
Proposal for a  Directive in 
order to coordinate certain 
aspects of the national law s 
regulating advertising o n  radio 
and television 1 9 8 5 1 9 8 7
Proposal for a Directive in 
order to coordinate certain aspects 
of the national law s regulating copy­
rights in simultaneous cable transmission 
of program m es 1 9 8 5 1987
Proposals concerning the gradual 
opening up of the market in 
information services 1 9 8 6 1 9 8 7
Proposal concerning the definition 
of c o m m o n  technical features of 
the m achines used to produce the n e w  
paym ent cards 1 9 8 6 1987
Proposals encouraging the 
conclusion of agreements betw een 
banks, traders, producers and 
consum ers o n  the compatibility of 
system networks, linkage user 
rules and/or rates of com m ission 1 9 8 6 1 9 87
V . C A P I T A L  M O V E M E N T S
P E R IO D  1985-1986
Liberalisation of units in collective 
investment undertakings for 
transferable securitiesC O M (78)63 
C O M (79) 328 1 9 7 9 1 9 8 5
Proposal for a  Directive
concerning the liberalisation of transactions concerning 
mortgages 1 9 86 1987

- 2 9  -
S U8J E C T  Doc.nu  D ate oi Expected
C o m m is- date for
sion's adoption
proposal b y  Council
Proposals for the liberalisation 
of operations such as the issue, 
placing and acquisition of 
securities representing risk 
capital, transactions in 
securities issues b y  C o m m u n ity  
institutions and long-term
com m ercial credit 1 9 86 1 9 87
VI. C R E A T I O N  O F  S U I T A B L E  C O N D I T I O N S F O R  I N D U S T R IA L C O O P E R A T I O N
1. C o m p a n y  law
P E R IO D  1985-1986
Proposals for a  Regulation 
for an European E co n o m ic 
Interest G rouping C O M (73)2046 
C 0 M (7 8 )1 3 91 9 7 3
1 9 7 8 1 9 8 5
Proposal for a  Fifth C o m p a n y  
L a w  Directive (structure 
of public limited com panies) C O M (72)887 
C 0 M (8 3 )1 8 51 9 7 3
1 9 8 3 1 9 88
Proposal for a  Tenth Directive 
concerning cross-border mergers C 0 M (8 4 )7 2 7 1 9 8 5 1 9 8 7
Proposal for an Eleventh 
C o m p a n y  L a w  Directive to 
dispense branches of 
com panies from  
publishing separate accounts 1986 19 8 8
P E R IO D  1987-1992
Proposal tor a  Directive o n  the 
liquidation of com panies 1 9 87 1 9 8 9
Proposals for a  Directive o n  
take over bids1 9 87 1 9 8 9
Proposal for a  Directive
o n  the relationship of undertakings1 9 8 8 1 9 90
in a  group

-30 -
“ S Ü B jT c T "  ~ ~  D c c ~ na  D ate of Expected
C o m m is- date for
si on's adoption
proposal b y  Council
A m e n d m e n t to proposal for 
a  Regulation o n  the Statute for 
a  European C o m p a n yC O M (70)600 
C O M  C  7 5  > 1 5 01 9 7 0
1 9 7 5
19 8 8 19 9 0
2. Intellectual and industrial property 
P E R I O D  1985-1986
A m e n d e d  proposal for a
Regulation o n  C o m m u n ity  C 0 M (8 Q )6 3 5  1 9 8 0
trade m arks C 0 M (8 4 )4 7 0  19 8 4  1 9 87
A m e n d e d  proposal for a  First 
Directive to approxi­
m ate the law s of the M e m b e r C Q M (8 0 )6 3 5  1 9 8 0
States relating to trade m arks 1 9 8 5  1 9 87
Proposal for a  Regulation o n  the 
rules needed for implementing 
the C o m m u n ity  trade m ark
regulation 1 9 8 5  1 9 8 7
Proposal o n  the site of the 
C o m m u n ity  trade m ark  office
and its w orking language 1986 1 9 87
Proposal for a  Regulation o n  
the rules of procedure for the 
Boards of A ppeal of the C o m m u n ity
trade mark's Office 1986 1 9 8 7
Proposal for a  Regulation 
o n  the fees to b e paid 
to the C o m m u n ity  Trade
M a rk  Office 1 9 8 6  1 9 8 7
Proposal for a  Directive o n  
legal protection of micro-
circuits 1 9 8 5  1 9 8 7
A m e n d e d  Convention o n Signature Entry
the C o m m u n ity  Patent b y  M e m b e r into
States in force in
1 9 8 6 1 9 8 7
Creation of a  C o m m u n ity Signature Entry
Patent's A ppeal Court (C 0 P A C ) b y  M e m b e r into force
States in 1 9 8 7
in 1 9 8 6

- 3 1  -
S U B J E C T D oc-nu D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
P E R I O D  1987-1992
Proposal for a  Directive o n  legal 
protection of biotechnological 
inventions1 9 8 7 1 9 89
Proposal for a  Directive to protect 
com puter program s1 9 87 1 9 89
3. Taxation (R em oving tax obstacles to 
different M e m b e r States:)cooperation betw een enterprises in
P E R I O D  1985-1986
Arbitration procedure concerning 
the elimination of double taxation*C 0 M (7 6 )6 1 1 1 9 7 6 1 9 8 5
C o m m o n  system of taxation applicable 
to parent com panies and their 
subsidiaries*C O M (69)6 1 9 6 9 1 9 8 5
C o m m o n  system of taxation of mergers, 
divisions and contributions of 
assets*C 0 M (6 9 )5 1 9 6 9 1 9 8 5
Harmonization of taxes o n  
transactions in securities C 0M (76)1 2 4 1 9 7 6 1 9 8 6
VII. A P P L IC A T IO N  O F  C O M M U N I T Y  L A W
1. Transparency 
P E R IO D  1985-1986
C om m unication of the C om m ission in 
relation to Article 3 0  of the Treaty 
o n  price fixing and o n  sickness 
insurance concerning pharmaceuticals1 9 8 5 N o
decision
needed
P E R IO D  1987-1992
com m unication ot the C om m ission 
in relation to Article 3 0  of the Treaty 
o n  the conditions of allowing o n  the 
market of foodstuffs1 9 87 N o  ·
decision
needed

_  3 2  „
S U B J E C T D oc.n" D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
C om m unication of the C om m ission in 1 9 8 9 N o
relation to Article 3 0  of the Treaty decision
o n  the elimination of controls and needed
formalities o n  goods
2. Competition policy and state aids 
P E R I O D  1985-1986
Inventory of State aids and report 
setting out the implications of 
future state aids policy1 9 86 N o
decision
needed

- 3 3  -
S U B J E C T  D o c  ,n° D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
P A R T  T H R E E : R E M O V A L  O F  F IS C A L  B A R R I E R S
I. V .A .T.
P E R IO D  1985-1986
Proposal for a  Council Decision 
providing for a  standstill 
ensuring:
- n o  proliferation of V A T  rates 
in M e m b e r States
- n o  widening of the gap betw een
V A T  rates in each M e m b e r State 1 9 8 5 1 9 86
14th V .A .T. Directive concerning 
deferred paym ent o n  importation* C O M (82)402 1 9 8 2 1 9 8 5
Proposal o n  flat rate farmers 1 9 8 5 19 8 6
Proposal o n  passenger transport 1 9 8 5 Ï986
Proposal o n  special schem es for 
small business 1 9 8 5 1 9 86
/th V .A .T. Directive w orks of art, 
collectors' items, antiques and 
used goods* C O M (77)735 
C 0 M (7 9 )2 4 91 9 7 8 1986
lüth V .A .T. Directive concerning 
expenditure o n  w hich tax is not 
deductible*C O M (82)870 
C 0 M (8 4 )8 41 9 8 3 19 8 6
,13th V .A .T. Directive concerning 
tax refunds to persons not esta­
blished in the C o m m u n ity *C O M (82)443 
C 0 M (8 3 )4 1 31 9 8 2 1 9 8 6
16th V .A .T. Directive concerning 
imports b y final consum ers of 
goods w hich have already borne 
tax in another M e m b e r State* C O M (84)318 1 9 8 4 1 9 8 6
1/th V.A .T. Directive concerning 
the temporary importation of goods 
other than m ean s of transport* C O M (84)412 1 9 8 4 1 9 8 5
iiith V .A .T. Directive concerning 
the abolition of certain derogations 
(Article 28(3) of Directive 77/388/C E EC O M (84)649 1 9 8 4 1986
Ivth V .A .T. Directive :  miscellaneous
supplementary and am ending provisions of Directive 77/388/E E C C O M (84)643 1 9 8 4 19 8 6

- 3 4  -
S U B J E C T Doc.n“ D ate of 
C o m m is­
sion's 
proposalExpected 
date for 
adoption 
b y  Council
Directive o n  the stores of ships, 
aircraft and international trains* C O M (79)794 1 9 8 0 1 9 8 6
Proposal concerning the rate 
structure (num ber of rates) 1 9 8 6 1 9 8 7
Proposal fixing the c o m m o n  rate(s) 
and corresponding standstill 
arrangement 1 9 8 6 1 9 87
P E R IO D  1987-1992
Proposal concerning abolition 
of derogations with distortive 
effects 1 9 8 7 1 9 8 8
Proposal concerning the establishment 
of a  V .A .T. Clearing H o u se System 1 9 8 9 19 9 0
II. E X C IS E  D U T I E S
P E R IO D  1985-1986
Proposal for a  Council Decision providing 
for a  standstill ensuring n o  introduction 
of n e w  excise duties w hich give rise to 
border formalities 1 9 8 5 1986
Proposals concerning harmonization 
of the structure of excise duties o n  
alcoholic drinks*C 0 M (7 2 )2 2 5
Final
C O M (82)153 
Final
C 0M (85)1 5 0  
Final
C Q M (8 5 )1 5 1
Final1 9 7 2
1 9 8 2
1 9 8 5
1 9 8 51 9 8 5
1 9 8 5
1 9 8 5
1 9 8 5
Proposal for an excise duty o n  w ine C 0 M (7 2 )2 2 5
Final1 9 7 2 1 9 8 6
Proposal concerning the introduction 
of a  third stage concerning the 
harmonization of the structure 
of cigarette duty* C O M (80)69 1 9 8 0 19 8 6
Proposal concerning the harm oni­
zation of the structure of excises 
o n  mineral oiIs C O M (73)1234 1 9 7 3 19 8 6

- 3 5  -
S U B J E C T  — “  Doc.rT D ate of Expected
C o m m is- date for
sion's adoption
proposal b y  Council
Proposal concerning the harmonization 
of the structures of excise duties
o n  other manufactured tobacco 1986 1 9 8 7
Proposal concerning the
final stage of the harmonization
of the structure of cigarette duty 1986 1 9 87
Proposals o n  c o m m o n  rate bands for 
all harm onized excise duties and 
corresponding standstill
arrangement 1 9 8 6  1 9 8 7
PERIOD 1987-1992
Proposals concerning the gradual 
abolition or reduction of excises 
not covered b y  the C o m m o n  system 
and giving rise to border formalities1987-1989 1988- ■1989-
1990
Proposal concerning the introduction 
of a  linkage between national bonded 
warehouses for excise goods 1 9 8 9 1 9 9 0