COMMISSION STAFF WORKING DOCUMENT on the result of the performance checks of the internal market for services (construction, business services and tourism) Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the implementation of the Services Directive. A partnership for new growth in services 2012-2015
Date: 2012-06-08
Institutions: European Commission
Subjects: administrative formalities, building industry, consumer protection, freedom to provide services, legal adviser, national implementing measure, single market, tax system, tertiary sector, tourism

EUROPEAN COMMISSION 

Brussels, 8.6.2012  
SWD(2012) 147 final 

COMMISSION STAFF WORKING DOCUMENT 

on the result of the performance checks of the internal market for services (construction, 
business services and tourism) 

Accompanying the document 

Communication from the Commission to the European Parliament, the Council, the 
European Economic and Social Committee and the Committee of the Regions  

on the implementation of the Services Directive.  
A partnership for new growth in services 2012-2015  

{COM(2012) 261 final} 
{SWD(2012) 146 final} 
{SWD(2012) 148 final} 

EN 

   EN 

 
 
 
 
  
 
 
COMMISSION STAFF WORKING DOCUMENT 

on the result of the performance checks of the internal market for services (construction, 
business services and tourism) 

Accompanying the document 

Communication from the Commission to the European Parliament, the Council, the 
European Economic and Social Committee and the Committee of the Regions  

on the implementation of the Services Directive.  
A partnership for new growth in services 2012-2015  

This document is a European Commission staff working document for information purposes. 
It  does  not  represent  an  official  position  of  the  Commission  on  this  issue,  nor  does  it 
anticipate such a position 

 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
TABLE OF CONTENTS 

1.  BUILDING AN INTERNAL MARKET FOR SERVICES: 

ACKNOWLEDGING THE PROGRESS ACHIEVED.............................................. 3 

2.  WHY WERE THE PERFORMANCE CHECKS NECESSARY? PURPOSE 

AND METHODOLOGY OF THE EXERCISE ......................................................... 3 

3.  THE RESULTS OF THE PERFORMANCE CHECKS............................................. 5 

3.1.  Remaining challenges common to the three sectors.......................................... 5 

3.1.1.  The challenge of internal market rules not being fully 

implemented ........................................................................................ 5 

3.1.2.  Challenges beyond full implementation of existing rules ................... 6 

3.1.3.  Selling to consumers throughout Europe ............................................ 7 

3.1.4. 

Insurance coverage for cross-border service provisions ..................... 7 

3.2.  Sector-specific barriers...................................................................................... 8 

3.2.1.  Construction ........................................................................................ 8 

3.2.2.  Business services ................................................................................. 9 

3.2.3.  Tourism................................................................................................ 9 

4.  CONCLUSIONS:  REMAINING CHALLENGES.................................................. 11 

4.1.  Realising the full potential of existing legislation........................................... 11 

4.2.  Further facilitating the provision of services in certain sectors....................... 11 

4.3.  Duplication of requirements laid down in EU sector-specific 

legislation ........................................................................................................ 12 

4.4. 

Insurance for cross-border service provisions................................................. 12 

4.5.  Lack of full harmonisation of consumer protection rules ............................... 13 

ANNEX I: FINDINGS BY SECTORS............................................................................. 14 

 
 
 
 
 
 
 
 
1. 

BUILDING AN INTERNAL MARKET FOR SERVICES: ACKNOWLEDGING 

THE PROGRESS ACHIEVED 

The  adoption  of  Directive  2006/123/EC  on  services  in  the  internal  market  (Services 
Directive) and its implementation by Member States has eliminated a significant number 
of barriers to the provision of services in the internal market. 

However, work remains to be done to deliver the full potential of the internal market for 
services. In its Communication of 27 January 2011, "Towards a better functioning Single 
Market  for  services",  which  presented  the  results  of  the  mutual  evaluation  process 
provided for by the Services Directive1, the Commission announced an ambitious work 
plan to further improve the practical functioning of the internal market. One of the key 
actions was the launching of "performance checks" of the Single Market for services with 
a view to assessing how different pieces of EU legislation interact and are jointly applied 
on  the  ground  by  Member  States  in  three  important  economic  sectors  (construction, 
business services and tourism). The exercise has allowed the identification of a number 
of remaining barriers for services in the internal market that businesses face in their daily 
lives,  some  of  which  cannot  be  eliminated  by  the  Services  Directive  on  its  own  as 
explained in detailed below.   

The  identification  of  remaining  barriers  complements  the  identification  of  remaining 
instances  of  incomplete  implementation  of  the  Services  Directive  carried  out  in  the 
Commission Staff Working Paper on Detailed Information on the Implementation of the 
Services  Directive  that,  together  with  this  document,  accompanies  the  Communication 
from  the  Commission  to  the  European  Parliament  and  to  the  Council  on  the 
implementation of the Services Directive in accordance with Article 41 of the Services 
Directive, "A Partnership for New Growth in Services 2012-2015" (Communication for 
New Growth in Services). Actions to tackle the identified challenges hampering further 
growth for services are laid down in the Communication for New Growth in Services.  

2. 

WHY WERE THE PERFORMANCE CHECKS NECESSARY? PURPOSE 

AND METHODOLOGY OF THE EXERCISE 

The  construction  (6.3  %  GDP),  business  services  (11.7  %  GPD)  and  tourism  (4.4  % 
GDP) sectors were identified as candidates for the performance checks because of their 
potential for cross-border service trade within the EU. 2 Lessons drawn from these three 
sectors should provide useful insights and help identify best practices to stimulate growth 
in other economic sectors too. 

One  major  novelty  of  the  exercise  has  been  the  holistic  assessment  of  the  impact  of 
various  pieces  of  EU  legislation  on  business  activities.  The  performance  checks  have 
been  carried  out  on  the  basis  of  three  sector-specific  case  studies.  One  involved 
construction, architecture and related services. The other two concerned business services 

1   Communication from the Commission to the European Parliament, the Council, the European 
Economic and Social Committee and the Committee of the Regions - Towards a better functioning Single 
Market for services – building on the results of the mutual evaluation process of the Services Directive, 
COM (2011) 0020 final. 
2   Source: Eurostat, National Accounts Statistics, Gross Value Added, 2009 

3 

 
 
 
 
 
 
 
 
                                                 
(tax  advisers)  and  tourism  services  (tourist  guides,  travel  agents  and  tour  operators), 
respectively.  

Member States were called upon to explain in detail how national rules implementing the 
relevant directives would be applied on the ground to potential service providers wishing 
to establish themselves or provide cross-border services in their territory.3 The responses 
received  were  discussed  with  Member  States  in  the  Services  Directive  Expert  Group 
between  19  December  2011  and  27  April  2012.  The  case  studies  were  published,  and 
interested parties were invited to comment.4 

The scenario for the construction sector involved the combined application of Directive 
2005/36/EC  on 
the  mutual  recognition  of  professional  qualifications  (hereafter 
Professional  Qualifications  Directive),  Directive  2000/31/EC  on  E-Commerce  (E- 
Commerce  Directive),  the  Services  Directive  and  of  the  rules  of  the  Treaty  on  the 
Functioning  of  the  European  Union  (TFEU),  as  well  as  of  Directive  2006/114/EC 
concerning misleading and comparative advertising, Directive 2002/91/EC on the energy 
performance of buildings, Directive 2008/98/EC on Waste and Regulation 842/2006/EC 
on certain fluorinated greenhouse gases. The scenario for business services involved the 
combined  application  of  the  Professional  Qualifications  Directive,  the  E-Commerce 
Directive,  the  Services  Directive  and  the  TFEU  rules.  Finally,  the  scenario  for  the 
tourism  sector  involved  the  combined  application  of  the  Professional  Qualifications 
Directive, Directive 90/314/EEC on package travel, package holidays and package tours 
(Package  Travel  Directive),  Directive  93/13/EEC  of  5  April  1993  on  unfair  terms  in 
consumer contracts (Unfair Contract Terms Directive), the E- Commerce Directive, the 
Services Directive and the TFEU rules. 

As with the mutual evaluation process5, the performance checks have proven the value of 
innovative tools for governance of the internal market. They have shown the usefulness 
and  importance  of  raising  internal  market  awareness  in  the  daily  work  of  competent 
authorities at all levels. National authorities responsible for supervising different policies 
were called upon to cooperate in assessing the impact that the concrete implementation of 
the rules they apply on a daily basis could have on the internal market for services from 
the perspective of service providers who are subject to the cumulative application of all 
the European rules in the various areas.  

3   The questionnaires and the detailed background notes summarising responses by Member States can 
be found at http://ec.europa.eu/internal_market/services/services-dir/mutual_evaluation_en.htm 

4   Member States were invited to consult interested parties on the questionnaires. 
5   See COM (2011) 0020 final, referred to above in footnote 1. 

4 

 
 
 
 
                                                 
3. 

THE RESULTS OF THE PERFORMANCE CHECKS 

3.1. 

 Remaining challenges common to the three sectors 

Barriers identified as common to the three sectors assessed will be presented first. Given 
their cross-cutting nature, the solutions proposed to tackle them are expected to have the 
potential benefits for other sectors of the services economy. Barriers specific to the three 
sectors will be analysed in detail in Section 3.2. 

3.1.1.   The challenge of internal market rules not being fully implemented 

The  Services  Directive,  the  E-Commerce  Directive  and  the  Professional 
Qualifications Directive aim to facilitate the provision of services in the internal 
market by reducing the burden that business and professionals face in their daily 
lives. However, the exercise has revealed that a number of significant challenges 
still exist for businesses, in particular when they wish to provide services in other 
Member States.  

The  performance  checks  have  revealed  a  number  of  instances  of  deficient 
implementation of the three above-mentioned Directives, depriving citizens and 
businesses  of  the  benefits  they  aim  to  provide.  For  example,  certain  Member 
States do not allow providers to acquire insurance in other Member States. Total 
bans  on  a  form  of  commercial  communications,  which  are  prohibited  by  the 
Services  Directive,  still  apply  in  some  Member  States.  The  situation  for  cross-
border  service  providers  seems  particularly  challenging  with  regard  to  cross-
border service provisions where businesses (when providing services both online 
and offline) are often confronted with requirements which are imposed on them in 
addition  to  those  to  which  they  are  subject  in  the  Member  State  where  they  are 
established.  This  corroborates  the  findings  of  the  Commission  Staff  Working 
Paper  on  Detailed  Information  on  the  Implementation  of  the  Services  Directive 
which  accompanies  the  Communication  for  New  Growth  in  Services.  Certain 
requirements  affect  all  sectors,  such  as  horizontal  notification  obligations  laid 
down  for  cross-border  service  providers  in  some  Member  States.  Other  barriers 
are  sector-specific  and  concern  requirements  applied  to  service  providers 
established in other Member States, such as notification or authorisation required 
to  perform  a  given  activity,  or  insurance  obligations  duplicating  those  to  which 
providers are subject in their own Member States. Finally, certain Member States 
make  information  society  services  subject  to  regulatory  requirements  that  might 
contravene the internal market clause in the E-Commerce Directive. 

Furthermore,  as  was  already  highlighted  in  the  2011  Evaluation  Report  on  the 
Professional  Qualifications  Directive6,  certain  administrative  and  procedural 
burdens  connected  with  the  recognition  of  professional  qualifications  hamper 
cross-border  service  provision  for  professionals.  First,  Member  States  have 
divergent  views  as  to  the  need  to  use  the  possibilities  provided  for  in  the 
Professional  Qualifications  Directive  (prior  annual  declaration  and  subsequent 
registration pro forma for cross-border service providers), as to the way to apply 

6   http://ec.europa.eu/internal_market/qualifications/docs/news/20110706-evaluation-directive-

200536ec_en.pdf 

5 

 
 
 
 
 
 
 
 
 
                                                 
them (documents required and their form) and as to those professions for which a 
prior verification of qualifications can be justified for reasons of public health and 
consumer  safety.  In  federal  countries  that  regulate  professions  at  regional  level, 
professionals  sometimes  have  to  submit  several  declarations  when  they  want  to 
exercise  their  activities  in  more  than  one  region.  This  diversity  of  practices 
renders  the  provision  of  services  in  other  Member  States  more  complicated  and 
highlights  the  need  to  simplify  and  ensure  the  transparency  of  the  rules 
applicable.  Moreover,  certain  existing  practices  would  appear  to  contravene  EU 
rules. In the construction sector, for example, some Member States carry out prior 
checks  of  qualifications  for  professions  that  should  benefit  from  automatic 
recognition such as architects and, to some extent, certain crafts.7 In the tourism 
sector,  tourist  guides  who  wished  to  have  their  qualification  recognised  were 
asked  until  very  recently  in  certain  instances  to  show  a  certificate  of  military 
service.  Finally,  certain  practices  such  as  those  concerning  the  form  of  the 
documents  to  be  submitted  for  the  recognition  of  professional  qualifications 
(certified copies for non-essential documents) raise questions of consistency with 
the Code of Conduct for the Professional Qualifications Directive.8  

Finally,  the  cumulative  application  of  internal  market  rules  (namely  the 
Professional Qualifications Directive, the E-Commerce Directive and the Services 
Directive)  lacks  consistency  and  coherence.  For  example,  tariff  or  legal  form 
requirements  applicable  to  certain  professional  services  cannot  be  applied  to 
cross-border  providers  on  the  basis  of  Article  5(3)  of  the  Professional 
Qualifications  Directive  (since  they  are  not  directly  linked  with  professional 
qualifications).  Member  States  are  only  allowed  to  impose  such  rules  on  cross-
border  service  providers  if  they  are  justified  under  Article  16  of  the  Services 
Directive.  

3.1.2.   Challenges beyond full implementation of existing rules  

Some  of  the  remaining  challenges  cannot  be  addressed  by  ensuring  compliance 
with  unequivocal  obligations  laid  down  in  existing  internal  market  directives.9 
For  example,  Member  States  may  reserve,  in  accordance  with  the  TFEU,  the 
provision of particular services to professionals holding specific qualifications.10 
Significant divergences in the regulation of professions are apparent across the 
different Member States in the sectors analysed. This wide variation in regulation 
adds complexity to the provision of professional services in the internal market.  

For  professionals  acting  through  corporate  structures,  additional  challenges 
stem  from  the  wide  diversity  of  legal  form  and  shareholding  requirements 
maintained by some Member States for some professional services. The Services 
Directive  left  a  margin  of  discretion  to  Member  States  for  the  maintenance  of 
requirements that are subject to the tests of necessity and proportionality. Within 
this  margin,  Member  States  have  often  simply  opted  for  preserving  their  status 
quo  instead  of  relaxing  them  further  without  impairing  service  quality.  This 
means businesses may be required to adapt their legal form or their shareholding 
structures  in  order  to  set  up  secondary  establishments  or  provide  a  specific 

7    For professions benefiting from automatic recognition on the basis of professional experience – see 

Articles 16 et seq of the Professional Qualifications Directive (and its Annex IV) 
8   See http://ec.europa.eu/internal_market/qualifications/docs/future/cocon_en.pdf 
9   See Chapters II 2 and 3 of the Communication for New Growth in Services. 
10   See notably the judgments of the Court of Justice in cases C-294/00, Grabner, and C-3/95, Reisebüro 

Broede 

6 

 
 
                                                 
professional  service,  which  renders  them  less  able  to  respond  effectively  to 
market  demands.  This  is  explained  in  further  detail  in  the  business  scenario 
analysis below. 

3.1.3.  Selling to consumers throughout Europe 

A  significant  part  of  the  existing  consumer  protection  acquis  has  so  far  been 
based on minimum harmonisation, although more recent legislation has provided 
to  a  very  large  extent  for  full  harmonisation.11  The  tourism  scenario  assessed 
areas where a minimum harmonised level of consumer protection is set, such as 
in the Package Travel Directive and the Unfair Contract Terms Directive. In those 
areas, the performance checks exercise has shown that whenever Member States 
have  been  going  beyond  the  minimum  harmonisation  rules,  service  providers 
willing  to  provide  services  across  borders are  often  confronted  with  the  need  to 
adapt their practices to such legislation in other Member States. 12 With regard in 
particular  to  the  implementation  of  the Package  Travel  Directive,  the  remaining 
challenges  concern  pre-contractual  information  requirements  and  liability  as 
described in more detail in the tourism scenario below.  

3.1.4.  Insurance coverage for cross-border service provisions 

A  particular  difficulty  identified  in  the  three  scenarios  concerns  insurance 
obligations  to  which  service  providers  are  subject,  be  it  by  virtue  of  EU  rules 
(such as insurance obligations that Member States may impose on tour operators 
and travel agencies to provide evidence of the insolvency guarantee required by 
the  Package  Travel  Directive)  or  by  virtue  of  national  legislation.  A  significant 
number of Member States do not take account of insurance obligations complied 
with  in  the  Member  State  of  establishment,  which  results  in  the  duplication  of 
insurance coverage costs borne by businesses in tourism (in particular for travel 
agencies and tour operators), business services and construction sectors.  

Problems  related  to  insurance  do  not  only  result  from  a  duplication  of 
requirements. In addition, businesses and professionals in search of insurance for 
their  cross-border  service  provisions  (be  it  insurance  acquired  in  their  Member 
State  of  establishment  or  in  the  Member  State  where  they  intend  to  provide 
services) face a practical problem: insurance to provide services in other Member 
States  is  difficult  to  find  in  the  market,  whether  in  their  Member  State  of 
establishment or in the Member State here they intend to provide services.13 

11   See notably Directive 2005/29/EC on Unfair Commercial Practices and, more recently, Directive 

2011/83/EC on Consumer Rights which have provided to a very large extent for full harmonisation in 
their respective areas. 

12   See Chapter II 6 (2) of the Communication for New Growth in Services. 
13   See Chapter II 2 of the Communication for New Growth in Services. 

7 

 
 
 
 
 
                                                 
3.2. 

Sector-specific barriers 

3.2.1.  Construction 

This  Section  refers  only  to  findings  that  are  specific  to  the  construction  scenario.  This 
scenario  focussed  exclusively  on  cross-border  service  provision,  whereas  the  other  two 
scenarios covered establishment issues as well. 

3.2.1.1.   Mutual  recognition  of  accreditation  and  authorisations  issued  on 

the basis of sector-specific EU directives 

The exercise has shown that businesses and professionals face problems because of the 
lack  of  mutual  recognition  clauses  in  sector-specific  EU  legislation  that  provides  for 
authorisation or registration schemes or the certification of experts.  

EU  law  sets  up  a  system  of  controls  at  national  level  for  persons  performing  activities 
involving  fluorinated  greenhouse  (F-gases)  in  refrigeration  systems,  energy  efficiency 
certification and waste treatment and transport. The performance checks verified to what 
extent  authorised  or  certified  service  providers  can  exercise  their  activities  in  other 
Member States on the basis of the certificate or authorisation obtained in their Member 
State  of  establishment.  Duplication  of  requirements  hinders  the  exercise  of  activities  in 
the case of both secondary establishment and of cross-border service provision.  

As regards F-gases, the exercise has shown that the vast majority of Member States have 
made  provision  in  their  national  legislation  for  automatic  recognition  of  certificates 
issued  in  other  Member  States  for  those  handling  these  gases  (for  instance  when 
installing air  conditioning  systems).  This is specifically required by EU law.14 Member 
States  that  have  not  yet  done  so  committed  in  the  course  of  the  performance  checks  to 
insert such recognition clauses in their legislation.  

As  regards  the  energy  performance  of  buildings,  EU  legislation  (which  has  been 
recently reviewed) offers Member States two options for regulating access to the activity: 
through  qualifications,  resulting  in  the  application  of  the  Professional  Qualifications 
Directive  to  ensure  the  recognition  of  professional  qualifications  obtained  in  other 
Member  States;  or  through  accreditation.  While  Regulation  765/2008  establishes  a 
general  legal  framework  for  accreditation  and  mutual  recognition  of  accreditation 
certificates  by  public  authorities,  the  situation  remains  uncertain  in  those  areas  and 
Member  States  where  accreditation  is  not  used  systematically.  In  contrast  with  the 
situation regarding the handling of F-gases, the recognition of experts legally established 
in  other  Member  States  for  the  purposes  of  certifying  the  energy  performance  of 
buildings  faces  specific  difficulties.15  These  difficulties  are  related  to  the  fact  that 
Member States have established, amongst others, different calculation methodologies and 
procedures for assessing the energy performance of buildings which then require specific 
training to be properly applied.  

14   Regulation  842/2006/EC  of  17  May  2006  on  certain  fluorinated  greenhouse  gases  and  its 

implementing Regulations regarding requirements for certification and training.. 

15   http://www.epbd-

ca.org/Medias/Downloads/CA_Book_Implementing_the_EPBD_Featuring_Country_Reports_2010.pd
f .  

8 

 
 
 
 
 
 
 
 
 
 
 
 
                                                 
Finally,  concerning  waste-related  activities,  the  exercise  has  not  sufficiently  clarified 
the legal situation for providers who wish to operate in other Member States in this field. 
Under Chapter IV of Directive 2008/98/EC on Waste, Member States require permits or 
registration  for  waste-related  service  activities.  For  the  majority  of  Member  States, 
however,  it  is  not  clear  whether  providers  legally  established  in  another  Member  State 
and  complying  with  its  domestic  regulation  could  benefit  from  mutual  recognition  to 
avoid duplication of procedures or would be forced to register in a Member State where 
they intend to operate only temporarily.  

3.2.2.  Business services 

This  Section  refers  only  to  findings  that  are  specific  to  the  business  services  scenario, 
which analysed in particular the provision of tax advice services. 

3.2.2.1.  Regarding legal form and capital ownership  requirements 

The business services scenario has shown that despite the implementation of the Services 
Directive,  various  corporate  structure  limitations  and  capital  ownership  requirements 
have remained in place in many Member States for the provision of certain professional 
services. The Services Directive obliged Member States to ensure that these requirements 
comply  with  the  principles  of  necessity  and  proportionality.  Member  States  have  often 
opted for preserving the status quo in this exercise. Companies in the business services 
sector  are  thus  obliged  to  adapt  their  structure  when  they  establish  in  other  Member 
States or sometimes even when they wish to provide cross-border services. However, a 
number of Member States, even though they regulate the profession, make the full range 
of company forms available and allow non-professional shareholders without restriction 
or with only certain limitations. Finally, certain Member States have introduced specific 
company structures for providers of professional services with the aim of allowing them 
to  find  an  appropriate  business  structure  while  safeguarding  certain  specificities  of  the 
professions in question.  

3.2.2.2.  Regarding commercial communications 

The exercise has shown that not all total bans on a form of commercial communication 
for regulated professions have been removed, as required by Article 24(1) of the Services 
Directive.16  Total  bans  on  some  forms  of  commercial  communications  still  apply  for 
professional  services  in  a  limited  number  of  Member  States  (ban  on  canvassing  or  TV 
advertising for certain professions).  

3.2.3.  Tourism  

This section refers only to findings that are specific to the tourism scenario. 

3.2.3.1. 

Specific profession-related challenges 

Tourist  guides  who  wish  to  provide  services  to  clients  in  other  Member  States  face 
difficulties  due  to  the  fact  that  the  distinction  between  establishment  and  cross-border 
service  provision  would  seem  to  be  particularly  difficult  to  apply  in  practice  for  the 

16   See judgment of the Court of Justice of 5 April 2011, Société Fiduciaire, C-119/09. 

9 

 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
national  competent  authorities  (case-by-case  analysis).  As  a  result,  tourist  guides  are 
often  subject  to  the  rules  applicable  to  establishment  where  they  only  wish  to  provide 
cross-border services.  

3.2.3.2.  Divergence of consumer protection rules governing package travel 

sales 

Travel agents and tour operators suffer from divergent consumer protection rules due to 
the absence of maximum harmonisation in a large part of the EU consumer acquis, which 
constitutes a significant barrier for the cross-border provision of travel agency services.  

As regards the Package Travel Directive in particular, it would seem that the degree of 
harmonisation  achieved  with  pre-contractual  information  requirements  results  in 
obstacles  to  the  provision  of  cross-border  services.  The  Package  Travel  Directive 
currently prescribes minimum rules for the information that must be given to consumers 
in brochures, before the contract is signed, before departure and in the contract. Almost 
all  Member  States  have  added  some  obligations.  These  requirements  are  sometimes 
applied  to  businesses  established  in  other  Member  States  that  provide  services,  both 
online  or  offline.  This  makes  it  difficult,  for instance,  for  a  package  travel  organiser  to 
carry out marketing campaigns or produce brochures that can be used in several Member 
States.  

The  Directive  contains  rules  concerning  the  liability  of  package  travel  organisers  and 
retailers,  who  must  accept  responsibility  for  the  performance  of  the  services  offered.  It 
mentions  both  the  organiser  and  the  retailer,  which  leaves  in  the  discretion  of  the 
Member  States  to  decide  which  one  of  them  should  be  obliged  to  meet  the  obligations 
under the Directive. The Directive also specifies that the organiser and/or retailer that is 
party  to  the  contract  must  provide  sufficient  evidence  of  security  for  the  refund  of  any 
money paid over and for repatriation of the consumer in the event of insolvency. In this 
regard,  too,  the  Directive  leaves  broad  discretion  to  the  Member  States  regarding  the 
choice  of  the  appropriate  measures.  The  different  implementation  options  adopted  at 
national level often result in travel agents and tour operators having to acquire additional 
insurance  and  guarantees  to  provide  services  in  other  Member  States,  both  online  and 
offline, because those acquired in their Member State of establishment are not recognised 
as sufficient by other Member States. 

The  Unfair  Contract  Terms  Directive  sets  a  minimum  level  of  harmonisation.  It 
introduces the  notion of  'good  faith' in order to prevent  significant  imbalances  between 
the rights and obligations of consumers on the one hand and those of sellers and suppliers 
on  the  other.  This  general  requirement  is  supplemented  by  a  non-exhaustive  list  of 
examples of terms that may be regarded as unfair, set out in its Annex. The exercise has 
shown  that  Member  States  have  gone  beyond  this  list  in  some  cases,  which  results  in 
businesses  having  to  adapt  some  of  their  contract  terms  to  be  able  to  provide  services 
cross-border.  

10 

 
 
4. 

CONCLUSIONS:  REMAINING CHALLENGES 

The conclusions drawn from the performance checks exercise are set out below. Detailed 
follow  up  actions  to  address  each  of  the  identified  challenges  are  proposed  in  the 
Communication for New Growth in Services. 

4.1.  Realising the full potential of existing legislation 

Businesses  and  professionals  are  not  always  able  to  make  use  of  the  benefits  they  are 
supposed  to  gain  from  the  internal  market.  This  is  often  due  to  the  incomplete  or 
incorrect  implementation  of  the  Services  Directive,  the  Professional  Qualifications 
Directive  or  the  E-Commerce  Directive.  Further  efforts  are  needed  to  ensure  that  these 
rules are applied on the ground in a consistent and coherent way. 17 

It  is  also  important  to  ensure  that  the  full  implementation  of  internal  market  rules 
translates into benefits on the ground for businesses and professionals. Indicators that a 
correct application of the rules is taking place on the ground are normally updated PSCs 
reflecting legislation adapted to the Services Directive and evidence of a better use of the 
IMI. Actions will be taken to facilitate the emergence of these indicators. 18 

4.2. 

Further facilitating the provision of services in certain 
sectors 

Some of the remaining challenges cannot be addressed by correcting the implementation 
of internal market directives. Certain actions already taken under the Single Market Act 
aim  to  address  some  of  the  shortcomings  set  out  in  this  paper.  This  is  particularly  the 
case  with  the  recently  proposed  modernisation  of  the  Professional  Qualifications 
Directive  to  which  Chapter  II  3  of  the  Communication  for  New  Growth  in  Services 
refers. The quick adoption of the Commission's proposal is essential to further facilitate 
the  cross-border  provisions  of  services  and  the  establishment  of  professionals  in  other 
Member States. 

For cross-border service provision, the clear identification of the professions that can be 
subject to prior recognition of professional qualifications should remove uncertainty for 
professionals.  The  country-wide  validity  that  the  proposal  would  introduce  for  annual 
declarations  would  also  significantly  reduce  red  tape  for  professionals  providing  cross-
border services.  

Significant  divergences  in  the  regulation  of  professions  appeared  across  the  different 
Member  States  in  the  three  sectors  analysed.  This  wide  diversity  of  regulation  adds 
complexity  to  the  provision  of  professional  services  in  the  internal  market.  The 
transparency and mutual evaluation mechanism contained in the proposed modernisation 
of  the  Professional  Qualifications  Directive  would  help  to  reduce  this  complexity,  by 
reviewing  the  need  for  qualification  requirements.  Following  the  adoption  of  this 
proposal,  the  Commission  intends  to  present  a  Communication  in  2013  on  the  basis  of 
developments  in  Member  States  which  are  currently  in  the  process  of  reviewing 
regulation  of  their  professions,  notably  the  need  for  a  high  level  of  qualifications.  The 

17   See Chapters II 1 and 5 of the Communication for New Growth in Services. 
18   For PSC see Chapter II 7 of the Communication for New Growth in Services. 

11 

 
 
 
 
 
 
                                                 
future  Communication  shall  also  define  a  methodology  for  the  mutual  evaluation  of 
requirements  related  to  professional  qualifications  and  reserved  activities,  notably  by 
clarifying which information will be required from Member States on the justifications of 
their  regulated  professions  as  indicated  in  Chapter  II  3  of  the  Communication  for  New 
Growth in Services. 

As regards difficulties with requirements concerning legal form and shareholding, which 
often  still  apply  to  specific  professions,  the  performance  check  exercise  has  confirmed 
that there is a need for Member States to reassess their regulation on company forms and 
capital ownership in professional services and to develop solutions to prevent obstacles 
to the free movement of professional services resulting from these rules, as indicated in 
Chapter  II  2  of  the  Communication  for  New  Growth  in  Services.  The  margin  of 
discretion  that  the  Services  Directive  leaves  to  Member  States  when  assessing  the 
necessity and proportionality of these requirements should not be applied in a way that 
hampers further growth in the internal market for services.  

4.3.  Duplication of requirements laid down in EU sector-specific 

legislation 

A  problem  stemming  from  lack  of  mutual  recognition  and  hence  duplication  of 
requirements  has  been  identified  regarding  the  implementation  of  sector-specific  EU 
rules that require authorisation or accreditation of experts, notably for certification of the 
energy performance of buildings and for waste shipment. The application of Regulation 
765/2008  on  accreditation  should  enhance  acceptance  and  recognition  of  certificates. 
However, there is no clear provision on recognition of the accredited experts when they 
wish to provide cross-border services. A mutual recognition clause in sector-specific EU 
legislation,  as  already  exists  in  the  area  of  F-gases,  would  resolve  these  problems. 
Particular  efforts  might  be  necessary  to  overcome  difficulties  created  by  differing 
technical  standards  in  Member  States  for  the  certification  of  energy  performance.  The 
recent proposal for a revised Directive on energy performance19 introduces a clause that 
calls on Member States to make publicly available the certification schemes or equivalent 
qualification  schemes  for  energy  service  providers  and  to  cooperate  among  themselves 
and  with  the  Commission  on  comparisons  between  and  recognition  of  the  schemes. 
Actions  will  be  taken  to  achieve  this  objective  as  indicated  in  Chapter  II  6  (1)  of  the 
Communication for New Growth in Services.  

4.4. 

Insurance for cross-border service provisions 

Some Member States still do not allow service providers established in their territory to 
contract insurance in other Member States. In addition, a significant number of Member 
States do not take account of insurance obligations complied with in the Member State of 
establishment,  which  results  in  the  duplication  of  insurance  coverage  costs  borne  by 
businesses in the tourism (in particular for travel agencies and tour operators), business 
services and construction sectors.  

In  addition,  finding  insurers  that  offer  adequate  coverage  for  cross-border  service 
provision, either in the Member State of establishment or in the Member State where the 
service  is  to  be  provided,  can  be  difficult  (notably  in  the  construction  and  tourism 
sectors). Actions will be taken to ensure that these problems are tackled as indicated in 
Chapter II 2 of the Communication for New Growth in Services. 

19   COM/2011/0370 final - COD 2011/0172. 

12 

 
 
 
                                                 
4.5.  Lack of full harmonisation of consumer protection rules 

In areas where minimum harmonisation still applies, whenever Member States have been 
going  beyond  the  minimum  harmonisation  rules,  service  providers  willing  to  provide 
services across borders are often confronted with the need to adapt their practices to such 
legislation  in  other  Member  States.  Growth  in  the  internal  market  calls  for  progress 
towards  further  harmonisation  in  certain  pieces  of  legislation  where  appropriate  and 
necessary  as  indicated  in  Chapter  II  6  (2)  of  the  Communication  for  New  Growth  in 
Services, as shown notably by the results of the tourism scenario. 

13 

 
 
 
ANNEX I: FINDINGS BY SECTORS 

CONSTRUCTION 

Economic data20 

GDP (2009) 

6.3% 

Average growth rate  

2.38%  for construction 

(1999-2009) 

1.1% for all sectors of the EU economy 

Contribution to EU employment 
(2009) 

7.2% 

Average employment growth rate 
(1999-2009) 

Activities covered in the exercise 

Regulation  of  the  activity  (linked  to 
professional qualifications) 

1.28% for construction 

0.77% for all sectors of the EU economy 

civil 

engineers, 

Architects, 
construction 
companies,  craftsmen,  energy  performance  certification 
installers,  waste 
service  providers,  air  conditioning 
management and transportation activities 

general 

Strong diversity of regulation :  

-  Certain  Member  States  reserve  activities  (mostly 
architectural activities and crafts) to regulated professions 
in  the  sense  of  the  Professional  Qualifications  Directive. 
Other Member States do not reserve access to the various 
construction  activities  to  specific  regulated  professions 
but do control the use of professional titles. 

Professional qualifications required 

Application 
of 
Directive (PQD) on the ground: 

the  Professional  Qualifications 

-  For  the  cross-border  scenario,  divergent  views  of 
Member  States  as  to  the  need  to  use  the  possibilities 
provided for in the PQD (prior declaration and registration 
pro  forma)  and  the  way  to  apply  them  (documents  to  be 
required and scope of the prior declaration) 

-  Automatic  recognition  of  professional  qualifications  in 
Annex IV not always a reality 

20 Source: Eurostat, National Accounts Statistics: gross added value and total employment 

14 

 
 
 
 
 
 
 
                                                 
Corporate structure requirements 

Insurance 

For  the  temporary  cross-border  provision  of  services  (to 
which  this  scenario  was  limited),  no  specific  problems 
regarding 
requirements  were 
structure 
identified.  

corporate 

Obstacles  to  obtaining  insurance  for  cross-border  service 
provision 

Lack  of  recognition  of  compliance  with 
requirements 
insurance) 

insurance 
regarding  building-related 

(especially 

Relationship  between  different  EU 
instruments  

For construction-related activities: 

Need  to  ensure  mutual  recognition  of  authorisations  or 
certificates  issued  in  other  Member  States  for  certain 
activities  (energy  performance  of  buildings  and  waste-
related  activities)  where  EU  law  does  not  explicitly 
include mutual recognition obligations. 

legislation  explicitly 

includes  mutual 
Where  EU 
recognition  obligations  (fluorinated  greenhouse  gases), 
lack of compliance with such obligation in a very limited 
number of cases. 

For  energy  performance,  lack  of  sufficient  alignment  in 
standards  stands  in  the  way  of  mutual  recognition  at 
present. 

the 

Lack  of  clarity  on 
the 
Professional  Qualifications  Directive  and  the  Services 
Directive and need to ensure coherent application of these 
directives on the ground. 

relationship  between 

15 

 
 
BUSINESS SERVICES 

Economic data21 

GDP (2009) 

11.7% 

Average growth rate  

2.38%  for business services 

(1999-2009) 

1.1% for all sectors of the EU economy 

Contribution to EU employment 
(2009) 

11.7% 

Average employment growth rate 
(1999-2009) 

3.54% for business services 

0.77% for all sectors of the EU economy 

Activities covered in the exercise 

Tax advisers 

Regulations of the activity (linked 
to professional qualifications) 

Diversity of regulation of the activity:  

-  Access  to  professions  is  free  in  17  MS  but  subject  to 
professional qualification requirements in 11 MS.  

- 3 MS regulate the use of professional title. 

- Diversity in the scope/degree of reserved activities. 

Professional 
requirements 

qualification 

Application  of  the  Professional  Qualifications  Directive  on 
the ground: 

- variations in the application of compensation mechanisms 

-  issues  of  compliance  with  the  Code  of  Conduct  (forms  of 
documents to be submitted), 

-  divergent  views  among  MS  as  to  the  need  to  use  the 
possibilities  provided  for  in  the  PQD  (prior  declaration  and 
registration pro forma) and the way to apply them (documents 
required and scope of the prior declaration) 

Corporate structure  

Wide diversity of regulation: 

requirements 

-  some  MS  limit  the  legal  forms  available  or  require  capital 
ownership to belong to qualified professionals, 

- some MS do not provide for any limitation, 

-  some  MS  have  introduced  specific  company  structure  for 
professionals  and  allow  non-professionals  to  be  shareholders 
up to 49 %. 

21   Source: Eurostat, National Accounts Statistics: gross added value and total employment 

16 

 
 
 
                                                 
Insurance 

Advertising 

Consumers 

E-provision of services 

Relationship  between  different 
EU instruments 

Insurance  taken  out  by  the  professional  in  another  Member 
State is not always recognised 

Total  ban  on  some  forms  of  commercial  communications  still 
apply in certain Member states(cid:206) issue of compliance with the 
Services Directive (Article 24(1)) 

Not  fully  compliant  application  of  the  E-commerce  directive 
(e-providers  are  sometimes  subject  to  a  prior  recognition  of 
their professional qualifications) 

the  Professional  Qualifications 
The  relationship  between 
Directive, 
the  E-Commerce 
Directive needs to be clarified in some respects. Need to ensure 
coherent application of these directives on the ground. 

the  Services  Directive  and 

17 

 
 
 
TOURISM 

Economic data22 

GDP (2009) 

4.4% 

Average growth rate  

2.04% for tourism 

(1999-2009) 

1.1% for all sectors of the EU economy 

Contribution to EU 
employment (2009) 

6.1% 

Average employment growth 
rate (1999-2009) 

2.56% for tourism 

0.77% for all sectors of the EU economy 

Activities covered 

Travel and tour operators, travel agents 

Regulations  of 
linked 
to 
qualifications 

the  activity 
professional 

Wide variation in the regulation of travel agents/tour operators: 

 - Travel agents are a regulated profession in 9 Member States 

Regulation of the activity 

Wide variation in the regulation of tourist guides 

- Tourist guides are a regulated profession in 14 Member States 

Authorisation and notification schemes to ensure compliance with 
insurance  and  security  obligations,  sometimes  also  in  cross-
border cases  

Professional 
requirements 

qualification 

Application of the Professional Qualifications Directive on the 
ground: 

For travel agents and tour operators: 

-  variation in the application of compensation mechanisms 

-  issues  of  compliance  with  the  Code  of  Conduct  (forms  of 
documents to be submitted) 

- divergent views among Member States as to the need to use the 
possibilities  provided  for  in  the  PQD  (prior  declaration  and 
registration pro forma) and the way to apply them (documents to 
be required and scope of the prior declaration), 

For  tourist  guides:  application  on  the  ground,  difficulties  with 
control, establishment vs.service provision 

22 Source: Eurostat, National Accounts Statistics: gross added value and total employment 

18 

 
 
 
 
 
                                                 
Corporate 
requirements 

Insurance 

Advertising 

Consumers 

structure 

-- 

Duplication  of  insurance  obligations  for  the  performance  of 
contract.  Wide  discretion  given  by  Package  Travel  Directive  on 
the  liability  of  travel  agents  and  tour  operators  renders  cross-
border provision more difficult. 

Insolvency  protection:  duplication  of  requirements  to  meet 
obligation under the Package Travel Directive 

Difficulties  in  obtaining  insurance  for  cross-border  service 
provisions. 

--- 

Lack  of  full  harmonisation  for  pre-contractual  information 
requirements  in  the  Package  Travel  Directive  renders  cross-
border provision of services more difficult. 

The absence of a fully harmonised list of unfair contract terms in 
the Unfair Contract Terms Directive renders more difficult cross-
border provision of services 

Relationship  between  different 
EU instruments 

Need to ensure coherent application of the Services Directive, the 
Professional  Qualifications  Directive  and  of  the  E-Commerce 
Directive on the ground. 

19