Single market news. #65, 2013.
Date: 2013-05-06
Institutions: Directorate-General for the Internal Market and Services
Subjects: banking policy, serial publication, single market, trade policy

ISSN 1830-5210

2013

#65
SINGLE MARKETnews

12

Retail Action Plan

14

Vitorino Report 
published

16

New rules on money 
laundering

 Unitary Patent 
 Interview Commissioner Barnier 

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Internal Market 
and Services

2

 Contents 

                              Contents 

Editor 
Stefaan De Rynck

European Commission – Internal 

Market and Services DG

Unit A4

B-1049 Brussels

Tel:+32.2.2963421

Fax:+32.2.2954351

Deputy Editor
Jacqueline Tordoir

Tel:+32.2.2985663

Fax:+32.2.2954351

Online
http://ec.europa.eu/internal_market/smn.htm

European Commission, 2013

Reproduction is authorised provided 

the source is acknowledged

For further information

http://ec.europa.eu/internal_market/

index_en.htm

Your Europe

http://ec.europa.eu/youreurope

Photographs for this edition were supplied by
Cover © iStock;

Inside pages 

© iStock: p. 4, p. 5, p. 7, p. 8, p. 10, p. 12, 

  p. 15, p. 16,

© EU: p. 6, p. 11,

© ImageGlobe: p. 7,
© Fotolia/Joop Hoek: p. 18.

3   

4   

8   

12 

14 

16 

19 

Editorial

News in Brief

 Th  e Unitary Patent for Europe 
Interview with Commissioner Barnier 

Commission adopts European Retail Action Plan  

 Vitorino Report out on private copying 
and reprography levies 

New rules on money laundering and terrorist fi nancing 

Infr  ingements  

12

16

14

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                                Editorial 

SINGLE MARKET news

3

agreeing a text on capping bankers’ bonuses. The aim, 
beyond moral issues, is to limit unjustiﬁ able bonuses 
and to curb excessive risk-taking. (See news in brief, p.4)

On pp.16-18, you can read about the Commission’s 
latest proposals to strengthen EU rules on anti-
money laundering and fund transfers. They reﬂ ect 
recent changes in international standards designed 
to stop money launderers and terrorists from using 
the ﬁ nancial system to ‘clean’ their money. 

The Single Market is improving all the time. 
The Commission, together with the other EU institutions 
is busy at ironing out inequalities and tackling 
obstacles standing in the way of free movement 
of goods, services, capital and people. Two recent 
examples are explained in this Single Market News: 
on pp. 12-13, with an appeal for opinions on unfair 
retail trading practices and on pp.14-15, where Single 
Market News reports on former Commissioner Antonio 
Vitorino’s ideas on how to face the Single Market’s 
challenges in dealing with widely diverging national 
rules for private copying and reprography levies.

Finally, our latest scores on implementation of 
Single Market laws: according to our recently 
published ‘Internal Market Scoreboard’, 
Member States have improved their performance 
in bringing EU rules into national law on time. 
For the best results in 15 years, see on p.6.

Keep up with our latest news and subscribe to 
Single Market Monthly: 
https://webgate.ec.europa.eu/markt/mpm/index.cfm

Jonathan Faull
Director General for Internal Market and Services

The lead article for this Single Market News is an 
interview with Commissioner Barnier on the unitary 
patent, a European patent that will change the 
lives of innovators, companies and research and 
development institutes across Europe. With the 
recent agreement reached on the Uniﬁ ed Patent 
Court forming the last piece of the jigsaw for the 
patent package, patents providing uniform protection 
in 25 countries could be a reality as early as 2014.
This means costs will come down and paperwork will 
be reduced to a minimum. Read more on pp. 8-11.

It took nearly 30 years to get to an agreement on 
patents. Common rules for banks will not take as long, 
judging by the results of the latest ECOFIN Council and 
trilogue negotiations. We now have unanimous support 
for all the prudential rules derived from the Basel III 
agreement and widespread support for additional rules 
on bankers’ pay and transparency. The new rules will 
force banks to hold more and better capital, making 
them more robust in times of economic turbulence.  
Also, for the ﬁ rst time, co-legislators are close to 

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 News In Brief 

News In Brief 

Rules imposing stricter prudential standards for banks
Extracts from remarks made by Commissioner Michel Barnier during the press conference held at the European Parliament 
(on 28 February):  

The  Council  has  given  widespread  support  to  the  fundamental  principles  governing  the  new  rules,  a(cid:2) er  long  trilogue 
negotiations which have been ongoing since 2012. This now opens the way for the introduction of a single rule book, 
which from 2014 will apply to 8 200 banks of which nearly 4 000 are either mutual or cooperative banks. At present 
we have unanimous support for all prudential standards deriving from the Basel Accords and widespread support for 
additional rules concerning bankers’ pay and transparency standards. In this way, we are regulating the main source of 
ﬁ nancing for the European economy since our banks ﬁ nance 75 % of the economy and especially SMEs and regions.

These rules will require banks to hold more and better quality capital. This will make them more resistant to economic 
shocks and ﬁ nancial crises. For the ﬁ rst time at European level, a text also provides detailed rules on liquidity – and in 
particular, ﬁ xing a short term safety cushion. This is essential if we want banks to be able to withstand sudden shocks 
from  ﬁ nancial  markets.  If  rules  similar  to  these  had  been  in  place  6  years  ago  we  would  not  have  had  the  Lehman 
Brothers  case  or,  at  least,  we  would  not  have  not  experienced  such  devastating  consequences.  The  whole  text  has 
been ﬁ ne-tuned so as not to jeopardise the ﬁ nancing of the European economy. This has been our concern throughout 
the negotiations. For example, we have taken measures that aim to facilitate loans to small businesses and have also 
provided for a gradual phasing-in of the rules which have been carefully calibrated.

This  is  also  the  ﬁ rst  time  we  have  a  European  legal  text  providing  a  ceiling  on  bonuses.  The  aim,  beyond  the  moral 
dimension, is to limit bonuses that are paid out in an unjustiﬁ able and unjustiﬁ ed way, so that they do not encourage 
excessive risk-taking. We have also introduced new obligations on transparency, something the European Parliament has 
insisted on for legitimate reasons. Banks will be obliged to publish information on the proﬁ ts they make and the taxes 
they pay.

We are therefore ready to take a major step forward. The text now needs to be ﬁ nalised at the technical level, before its 
ﬁ nal adoption by the Council and the Parliament and publication in the Oﬃ  cial Journal before the end of the semester. But 
our agenda does not end here! We still have to reach an agreement on rules relating to the prevention and management 
of banking crises.  And our work on creating a banking union continues. To this end, I will present a proposal establishing 
a resolution authority this summer. Please note a(cid:2) er the press deadline for this article, political agreement was reached 
on the Banking Union and CRD4 ﬁ les on 19 and 20 March respectively.

More information: 

http://europa.eu/rapid/press-release_MEMO-13-155_fr.htm?locale=en

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Passenger rights: better protection for 
bus and coach travellers in the EU
On  1  March  an  EU  Regulation  on  bus  and  coach 
passenger rights became applicable, providing bus and 
coach  travellers  throughout  the  EU  with  new  rights. 
The  regulation  lays  down  travellers’  basic  rights,  and 
imposes  a  number  of  obligations  on  bus  and  coach 
companies  and  terminal  managers  concerning  their 
responsibility  towards  the  passengers.  Every  year 
around  70  million  passengers  travel  by  bus  and/or 
coach in the EU.

European  Commission  Vice-President  Siim  Kallas, 
responsible  for  transport,  said:  “We  have  kept  our 
promise: thanks to this regulation EU passenger rights 
are  also  extended  to  bus  and  coach  transport.  The 
EU is now the ﬁ rst area in the world with a full set of 
passenger rights for all modes of transport.” 

The  bus  and  coach  regulation  lays  down  passenger 
rights similar to those for air, train and boat transport. 
These new rights include:

  (cid:23) Non-discrimination based on nationality 

regarding tariﬀ s and other contract conditions;

  (cid:23) non-discriminatory treatment for disabled 
people and people with reduced mobility. 
Speciﬁ cally, free-of-charge assistance both at 
designated bus terminals and on board buses 
and coaches, as well as ﬁ nancial compensation 
for loss of or damage to mobility equipment.

More information:

http://ec.europa.eu/transport/passenger-rights/index.html

JOINT CONFERENCE BY THE EUROPEAN 
COMMISSION AND EUROPEAN 
CENTRAL BANK
on European Financial Stability and 
Integration:
“The impact of On-going Regulatory 
Reforms on Financial Integration and 
Stability”
On 25  April, the annual high-level conference organised 
by the European Commission and the European Central 
Bank on ﬁ nancial stability and integration will be held 
in Brussels. The conference will bring together political 
leaders, ﬁ nancial supervisors, academics and industry 
and  consumer  organisations  to  share  views  on  the 
current EU situation regarding ﬁ nancial integration and 
stability.  The  main  topics  covered  at  the  conference 
will be bank structural reform as well as EU ﬁ nancial 
market  integration  including  a  general  reﬂ ection  of 
their  importance  for  the  real  economy.  Conﬁ rmed 
keynote speakers are: Conﬁ rmed keynote speakers are 
Olli  Rehn,  Commissioner,for  Economic  and  Monetary 
Aﬀ airs  and  Vítor  Constâncio,  Vice  President  of  the 
European  Central  Bank.  For  further  details  regarding 
the programme, speakers and registration:

http://ec.europa.eu/internal_market/economic_
analysis/conferences/conference-130425_en.htm

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6

 News In Brief 

Internal Market Scoreboard: a record-breaking 
15th anniversary edition! 
Despite  the  challenging  times,  Member  States  have  performed 
better  than  ever  in  transposing  EU  rules  into  national  law  on 
time  according  to  the  European  Commission’s  Internal  Market 
Scoreboard  published  on  19  February.  The  Single  Market  has  a 
key role to play in bringing Europe out of economic stagnation. But 
it does not deliver beneﬁ ts automatically: timely transposition of 
laws  is  a  necessary  condition  for  achieving  the  policy  objectives 
set out in the directives.

In this edition, the best performers are Ireland, Malta, Estonia and 
Sweden, who managed to implement into their national legislation 
the highest number of directives. 

The  Internal  Market  Scoreboard  was  ﬁ rst  published  ﬁ (cid:2) een  years 
ago  and  today’s  edition  shows  great  improvements  by  Member 
States. The EU average transposition deﬁ cit – the percentage of 
Internal  Market  Directives  that  have  not  been  transposed  into 
national law in time – has decreased from 6.3 % in 1997 to a record new level of 0.6 %, i.e. below the 1 % target 
agreed by the European Heads of State and Government in 2007 and close to the 0.5 % deﬁ cit proposed in the Single 
Market Act in April 2011.

“I welcome this new record achieved by the Member States and I am happy with the dynamism and strong commitment 
they  have  shown  to  making  enforcement  work  on  the  ground.  This  is  the  best  result  ever.”  said  Internal  Market 
Commissioner Michel Barnier.

More information: http://ec.europa.eu/internal_market/score/index_en.htm

Structured stakeholder dialogue 
«Licences for Europe»
Online there are new ways of providing, creating and distributing content 
and new ways to generate value. The emergence of new business models 
that use the internet to deliver content represents both a challenge and 
an opportunity for the creative industries, authors and artists. The digital 
economy has been a major driver of growth in the past two decades, and 
is expected to grow seven times faster than overall EU GDP in coming 
years. The aim of the European Commission is to ensure that copyright 
and licensing stay ﬁ t for purpose in this new digital context.

As  announced  in  the  Communication  on  “Content  in  the  Digital  Single 
Market”, (18 December 2012) “Licences for Europe” is an initiative jointly 
led  by  Commissioners  Michel  Barnier  (Internal  Market  and  Services), 
Neelie  Kroes  (Digital  Agenda)  and  Androulla  Vassiliou  (Education, 
Culture, Multilingualism and Youth). Its main purpose is to seek to deliver 
rapid progress in bringing content online through practical industry-led 
solutions.

More information: 

http://ec.europa.eu/licences-for-europe-dialogue/

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In the EU27, both women and 
men could expect at birth to live 
62 years in a healthy condition …
…and 9 additional years at 
the age of 65
Healthy life years measure the number of years that 
a  person  can  expect  to  live  in  a  healthy  condition. 
At  birth,  both  women  and  men  in  the  EU27  could 
expect  to  live  62  years  in  a  healthy  condition  in 
2011. At the age of 50, they could expect another 
18 years living in a healthy condition, while at the 
age of 65, they could expect to have an additional 
9 healthy life years.

Both men and women in Sweden and Malta could expect to live more than 70 years in good health

Among the Member States, the highest number of healthy life years at birth in 2011 was estimated for both women 
and men in Malta (71 years for women and 70 years for men), Sweden (70 and 71 years), Luxembourg, Greece and 
Ireland (all 67 and 66 years), and the lowest in Slovakia (52 years for both) and Slovenia (54 years for both). In the 
majority of Member States, there was very little diﬀ erence in the number of years women and men can expect to 
live without health limitations. In 2011, the biggest diﬀ erences were found in Lithuania (5 more healthy life years for 
women) and in the Netherlands (5 more healthy life years for men).

At the age of 50, both women and men were expected to have more than 20 additional healthy life years in Sweden 
(26 years for women and 25 for men), Malta (23 years for both), Denmark (22 years for both), Luxembourg, Ireland 
and the United Kingdom (all 22 and 21 years). The lowest additional healthy life years were estimated for women 
and men in Slovakia (10 years for both). 

At the age of 65, healthy life years were highest in Sweden (15 additional years for women and 14 for men) and 
lowest in Slovakia (3 and 4 years). 

Eurostat News Releases on the internet: http://ec.europa.eu/eurostat

Guide to EU rules on stated aid, public 
procurement and services of general 
economic interest
The  European  Commission  services  have  published  an  updated 
guide  explaining  how  EU  rules  in  the  ﬁ elds  of  state  aid,  public 
procurement  and  the  internal  market  apply  to  services  of 
general economic interest (SGEI). The guide provides simple and 
comprehensive  answers  to  the  most  frequent  questions  asked 
by  public  authorities,  service  users  and  providers  and  other 
stakeholders, many of which are social enterprises. The revision 
takes  account  of  the  new  state  aid  rules  on  SGEI  that  the 
Commission  adopted  in  December  2011  and  April  2012,  the 
so-called  “Almunia”  Package.  The  guide  will  be  made  available 
in all languages.

More information: http://ec.europa.eu/competition/state_aid/
overview/public_services_en.html

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The Unitary Patent for Europe 
Interview with Commissioner Barnier 

Th  e international agreement on the Unifi ed Patent Court – the last building 
block of a truly Unitary Patent system for Europe – was signed by 24 EU 
Member States (all Member States except Spain and Poland) on 19 February 
and by Bulgaria on 5 March. Single Market News talked to Commissioner 
Barnier about what this means for innovators and companies Europe-wide. 

Why is the Unitary Patent package important?
It has taken more than 30 years to achieve a unitary 
patent covering so many EU countries. Once in force, 
this new system will enable innovators, EU companies 
and research & development institutes to ﬁ nally beneﬁ t 
from a levelling of the world’s playing ﬁ eld. Europe 
relies on its unique innovative community. But are 
we treating it well? The answer is: “not well enough”, 
with the result that up until now European companies 
have o(cid:2) en opted to protect of their inventions 
and know-how in the US rather than in Europe. 

Why would European companies not 
register their patents in Europe?
The reason is simple. Although the European Patent 
Convention ensures high standards of patent protection, 
possibly the best in the world, the business of getting 
that protection is just too burdensome and costly. 
Today, an EU-based SME seeking protection of its 
invention in the EU not only needs to have its so-called 
‘European’ patent granted by the European Patent 
Oﬃ  ce, but also has to have it validated separately in 
each EU Member State, i.e. in 27 diﬀ erent countries! 

➜

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This involves a huge ﬁ nancial investment: For a start, 
there are fees to be paid to each national patent oﬃ  ce.  
What is more, many EU countries require documents 
to be translated, which does not come cheap. Today, 
a ‘classical’ European patent protection, valid in all EU 
Member States costs about €36,000. This is far too high 
when compared to a patent registration fee of about 
€2,000 euro in the United States and €600 in China.  

With the new European ‘unitary’ patent about to be 
put in place, separate validation in each EU country 
will no longer be necessary. The option of the unitary 
patent will oﬀ er automatic protection in the 25 EU 
countries that agreed to sign up last December, and the 
cost will go down to about €5,000 euro – a sevenfold 
reduction! At last, it will become much simpler and 
cheaper to obtain patent protection in a Single Market 
of 500 million consumers. Investors will be able to 
re-inject the money they have saved into further 
research, development and innovation projects rather 
than having to spend it on administrative costs.  

So is this a “one size fi ts all” solution 
for Europe’s innovators? 
No, the unitary patent is a new option in the innovators’ 
toolbox.  Innovators in Europe are diverse. The new 
Unitary Patent System is no forced “one size ﬁ ts 
all”. It is not an obligation, but an additional option 
oﬀ ering more choice to innovating companies. 
They will now be able to choose, depending on 
their individual needs, between three options: 

  (cid:23)  a national patent, covering only the 
territory of the State concerned, 

  (cid:23) a ‘classical’ European patent, through a 
single procedure resulting in the grant 
of a title  that still has to be validated 
in as many countries as necessary, 

  (cid:23) the new ‘unitary patent’, providing uniform 
protection in 25 countries, at much lower 
cost and requiring less paperwork.  

It is critical to underline, though, that the scope 
of what can be patented will not change under 
the new system. But the how will dramatically 

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“

“With prompt ratifi cation by national parliaments, Europe’s most 
innovative companies could already start to get protection for their 
inventions with Europe’s unitary patents as early as 2014.”

change, with procedures that will be easier to 
handle and patents that are cheaper to obtain.

incentives from outside.  This is why we urgently need to 
give Europe’s innovative companies an eﬃ  cient,eﬀ ective 
system of patent protection, to stimulate innovation. 

When will this new patent be 
available, what is the urgency?
The agreement to set up the Uniﬁ ed Patent Court 
has just been signed.  It now needs to be ratiﬁ ed 
in each of the participating countries. I would like 
the countries to use this ratiﬁ cation process as an 
opportunity to look into what innovative companies 
bring to Europe, not just in terms of progress – new 
products and services – but also in terms of growth 
and jobs. It is an opportunity for everyone to start 
thinking more broadly about how to create and nurture 
an environment in which innovation can thrive. 

Innovation is a powerful engine for growth: innovative 
industries are more dynamic and create more and 
better jobs.  And growth from innovation is sustainable, 
emerging from organic development within businesses, 
rather than being created by expensive ﬁ scal support or 

Innovation does not happen overnight. It takes vision, 
and investment, o(cid:2) en over decades, to bring a new 
product to market. For companies to take the right 
investment decisions today, they need certainty 
about the regulatory framework of tomorrow. In 
this time of crisis, we cannot aﬀ ord delays.  I want 
the new system to be implemented as quickly 
as possible.  With prompt ratiﬁ cation by national 
parliaments, Europe’s most innovative companies could 
already start to get protection for their inventions 
with Europe’s unitary patents as early as 2014.

This is a unique opportunity to promote new 
growth. Let’s make sure we make it happen.  (cid:31)  

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12

 Commission adopts 
 European Retail Action Plan 

Th  e Commission adopted a European 
Retail Action Plan in January. 
Th  is together with a consultation on unfair 
business-to-business trading practices should 
boost the retail sector in the Single Market. 

Retail and wholesale services are among the most 
important sectors in the EU economy and should 
play an essential part in stimulating growth and 
job creation under the Europe 2020 strategy. 
They account for 11 % of EU GDP and 29 % of 
European SMEs and employ nearly 33 million people.

A number of barriers to the Single Market in Retail 
hinder the smooth functioning of cross-border sourcing, 
consumer access to cross-border retail services 
and deter retailers from entering the market.1  

The Action Plan, puts forward concrete actions to overcome 
these barriers, with a direct impact on the retail sector. 

Its ﬁ ve priorities are:
1.   Empowering consumers: Empowered consumers 
can make better purchasing decisions. It means 
facilitating consumers’  access to transparent 
and reliable information, making it easier to 
compare prices and improving the quality and 
sustainability of goods and services.

2.   Improving accessibility to retail services: 

The restrictions on establishment imposed in many 
Member States are among the main obstacles to 
a proper functioning of the Single Market in retail. 
One key action of the Action Plan in this respect 
is promoting an exchange of best practices on 
commercial and spatial planning rules, in parallel 
with a performance check of existing national rules.

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3.   Fairer and more sustainable trading 

relationships along the food and non-food 
supply chain: a consultation addressing the 
issue of unfair business-to-business trading 
practices was launched (see more detail below). 

4.   Ensuring a better link between retail and 

innovation. Innovation is one of the most crucial 
factors in ensuring economic growth. Retailers 
are major drivers of innovation. They closely 
follow consumer trends while helping to set 
these and pass this knowledge on to suppliers. 
However, many EU retailers have not succeeded 
in reinventing their business models to fully 
beneﬁ t from the potential of new technologies. 
Adequate mechanisms should therefore be put in 
place to improve retailers’ stake in innovation.

5.   Creating a better work environment. 

Existing mismatches between labour force skills 
and the needs of the retail sector pose signiﬁ cant 
challenges for the optimal functioning of the sector. 
The launch in 2012 of a European Sectoral Skills 
Council for the commerce sector — covering retail 
and wholesale — is expected to play a crucial role 
in building up sector skills intelligence, together 
with national skills councils in this sector.

Consultation on business 
to business trading
The Green Paper (consultation) on unfair 
trading practices in the business-to-business 
food and non-food supply chain is one of 
the key initiatives of the Action Plan.

Unfair trading practices are practices that grossly 
deviate from good commercial conduct and are 
contrary to good faith and fair dealing. Such practices 
include failure to provide suﬃ  cient information about 
contract terms, demanding payments for goods 
or services that are of no value to the client and 
unilateral or retroactive changes of contract terms.

Unfair trading practices may have detrimental eﬀ ects 
on the EU economy as a whole and for the business-to-
business food and non-food supply chain in particular. 
Such practices may aﬀ ect the capacity of companies, 

including SMEs, to invest and innovate. Moreover, 
the fact that national rules are fragmented may 
constitute an additional obstacle to engaging in cross-
border sourcing and distribution in the Single Market.

The Green Paper consults stakeholders 
on the following issues:
  (cid:23) The extent of the problem in 
unfair trading practices,

  (cid:23) The eﬃ  ciency of national legal or 

self regulatory systems, 

  (cid:23) The impact of diverging national rules on 
the functioning of the Single Market.

The consultation will help to establish whether 
unfair trading practices pose a problem both in the 
food and non-food supply chain. It will also seek 
views on a number of principles of good practice 
aimed at combatting unfair trading practices.

The Green Paper enables the Commission to 
acknowledge progress made so far under the 
auspices of the Business-to-business Platform of 
the High Level Forum for a Better Functioning Food 
Supply Chain2. This Platform has agreed on a set of 
principles that should be adhered to in business-to-
business relationships in the food sector. However, 
given the lack of consensus in devising enforcement 
mechanisms for these principles, it was decided 
to adopt a ‘twin-track’ approach by launching an 
impact assessment in parallel. The contributions to 
the consultation launched by this Green Paper will be 
taken into account in this impact assessment.  (cid:31) 

The consultation closes on 30 April 2013:
http://ec.europa.eu/internal_market/consultations/2013/
unfair-trading-practices/index_en.htm

1  These barriers have been identiﬁ ed in the Commission’s 

Retail Market Monitoring Report of July 2010, the EP Report 
‘Towards a more eﬃ  cient and fair retail sector’ of July 2011, 
the Country Speciﬁ c recommendations issued by the Council 
in 2012 and through workshops the Commission organised 
last spring with representatives of the main stakeholders.

2  http://ec.europa.eu/enterprise/sectors/food/
competitiveness/forum_food/index_en.htm

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14

 Vitorino Report out on 
 private copying and reprography levies  

On 31 January, former Commissioner Antonio Vitorino, who led the 
mediation process on private copying and reprography levies, presented 
his recommendations on these issues to Commissioner Barnier. 

Mr Vitorino’s task was to revive discussions between 
stakeholders in order to ﬁ nd practical solutions that: 

1.   create an environment favourable to the 
development of new business models 
in the digital environment, and

2.   reconcile the existing national private 

copying and reprography levy systems with 
the principles of the Single Market.

The mediation process
In April 2012, Mr Vitorino called for written contributions 
from all interested parties. In parallel, the mediator 
conducted a series of bilateral and multilateral meetings 
with key stakeholders representing consumers, right 
holders, collecting societies, the ICT industry and SMEs.

Status quo
Levies constitute a viable source of income 
for right holders. It is estimated that in 
2010 the collection of private copying levies 
amounted to over €600 million in the EU. 

Levies are also the source of a number of problems 
aﬀ ecting the functioning of the Single Market.

The current levy systems are national in scope and 
diﬀ er substantially both with regard to the products 
subject to a levy and with regard to the rates applicable 
to the same or a similar piece of equipment.

For example, in 2010 a blank DVD was subject to a 
levy of €1.00 in France, €0.48 in Denmark, €0.0139 in 
Germany, 2.5 % of the sales price in Poland and 6 % 

of the import price in Lithuania. In the same year, an 
MP3 Player was subject to a levy of between €1.00 and 
€20.00 (depending on the capacity) in France, no levy 
at all in Denmark, €5.00 in Germany, 3 % of the 
sales price in Poland and between €0.43 and €11.58 
(depending on capacity) in Lithuania. A mobile 
phone with an internal memory of 32 GB was 
subject to a levy of €36.00 in Germany (provided 
it was equipped with a touch screen), €18.00 in 
Hungary, €10.00 in France, €4.34 in Lithuania, €0.9 
in Italy and 0.5 % of the sales price in Romania.

Companies wanting to sell their products in various 
EU markets have to deal with divergent rules, bear the 
associated administrative costs and, in some instances, 
run a risk of paying the levy twice — e.g. in the country 
of manufacture or importation and then again in the 
country in which the product is sold. The diﬀ erences 
between national levy systems also create distortion of 
competition tending to encourage ‘grey market’ imports.

Mr Vitorino’s recommendations
Mr Vitorino’s report builds on the arguments put 
forward by stakeholders in the mediation process 
as well as on the case law of the European Court of 
Justice. He identiﬁ es two parallel types of actions. 
First, in order to foster the development of new 
and innovative business models in the digital Single 
Market, Mr Vitorino recommends making greater 
use of licensing agreements which, in particular 
in the context of services oﬀ ered in the digital 
environment, allow creators to be remunerated 
directly. Second, he recommends introducing a 
number of measures aimed at increased transparency, 
credibility and simplicity of national levy systems.

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15

Next steps
Upon receiving the recommendations, Commissioner 
Barnier announced his intention to discuss 
Mr Vitorino’s ﬁ ndings with the Member States. 
Mr Vitorino’s recommendations will be debated 
within the Competitiveness Council.   

In parallel, the recommendations will be 
carefully analysed by the Commission. They 
constitute an important element feeding into 
the process of assessment of the ‘ﬁ tness’ 
of the copyright system for the 21st century 
initiated by the Commission on 18 December 
2012 with the adoption of the Communication 
on Content in the Digital Single Market.  (cid:31)

Full text of Mr Vitorino’s report:
http://ec.europa.eu/internal_market/
copyright/docs/levy_reform/130131_levies-
vitorino-recommendations_en.pdf

More speciﬁ cally, in relation to the ﬁ rst part of his 
recommendations, Mr Vitorino would like it to be 
clariﬁ ed that copies that are made by end users for 
private purposes, in the context of a service that 
has been licensed by rightholders, do not cause 
any harm requiring additional remuneration in 
the form of levies. Licenced copies should not be 
remunerated a second time in the form of levies.

With regard to the second objective, i.e. 
the improvement of the functioning of levy 
systems in order to reconcile them with the 
free movement of goods and services in the 
Single Market, Mr Vitorino recommends that:

  (cid:23) in cross-border transactions, levies 
be collected in the Member State in 
which the ﬁ nal customer resides;

  (cid:23) the liability for paying levies be shi(cid:2) ed from 
manufacturers and importers to retailers, 
provided that the tariﬀ  systems are simpliﬁ ed 
and that manufacturers and importers are 
obliged to inform collecting societies about their 
transactions concerning goods subject to a 
levy; or, alternatively, clear and predictable 
ex ante exemption schemes be established;

  (cid:23) in the ﬁ eld of reprography, more 

emphasis be placed on operator levies 
than on hardware-based levies;

  (cid:23) levies be made more visible 
for the ﬁ nal consumer;

  (cid:23) more consistency be introduced 
with regard to the process of 
setting levies, notably by deﬁ ning 
‘harm’ (caused to right holders by 
acts of copying made possible by 
the private copying and reprography 
exceptions) uniformly across the EU 
and by simplifying the procedural 
framework in which levies are set, 
guaranteeing objectiveness and ensuring 
that strict time limits are observed.

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 New rules on money laundering  
 and terrorist ﬁ nancing 

On 5 February, the Commission adopted 
two proposals to reinforce the EU’s existing 
rules on anti money laundering and 
fund transfers. As the threats associated 
with money laundering and terrorist 
fi nancing are constantly evolving, it is 
important to periodically update the rules 
governing the preventative fr amework.

Why these proposals?
In Europe and around the world, criminals ‘launder’ 
money they obtain through fraud, corruption, drug 
dealing and other serious crimes by passing it through 
legitimate channels such as banks and insurance 
companies. This makes it appear ‘clean’, and harder 
to trace back to crime. The ﬁ nancial system can also 
be used as a channel for the funding of terrorists.  

Criminals are constantly searching out new 
vulnerabilities they can exploit. The amount of 
criminal proceeds seeking to enter the ﬁ nancial 
system, concealing their illicit origins is truly 
staggering. A recent study by the United Nations 
has estimated that the amount of funds available 
for money laundering annually is somewhere in the 
region of $1.6 trillion, equivalent to 2.7 % of global 
GDP. They also estimated that less than 1 % of 
laundered funds are intercepted by law enforcement, 
and actual seizures amount to less than 0.2 %1.

What rules are in place and why do 
they need updating?
The EU already has anti-money laundering and 
anti-terrorist ﬁ nancing laws covering the ﬁ nancial 
services industry and others whose services risk 
being misused by criminals: lawyers, accountants, 

casinos, real estate agents, traders in high value 
goods, and trust and company service providers. But 
these EU rules need to be updated to reﬂ ect recent 
changes in international standards designed to stop 
money launderers and terrorist ﬁ nancers from using 
the ﬁ nancial system. The Financial Action Task Force 
(FATF) published a new set of revised standards in 
February 2012. These new standards will enable 
national authorities to take more eﬀ ective action 
against money laundering and terrorist ﬁ nancing at 
all levels – from the identiﬁ cation of bank customers 
opening an account through to investigation, 
prosecution and forfeit of assets. They will also better 
address the laundering of the proceeds of corruption 
and tax crimes and strengthen the requirements 
for higher risk situations and allow countries to 
take a more targeted risk-based approach.

In parallel to this process, the European Commission 
undertook a review of the EU framework, and published 
a report on the application of the Third Anti-Money 
Laundering Directive (“Third AMLD”) in April 2012.
The implications of this work were that the EU 
framework would need to evolve and adjust to changes 
which should see an increased focus placed on the 
eﬀ ectiveness of regimes to counter money laundering 
and terrorist ﬁ nancing, greater clarity and consistency of 
the rules across Member States, and a broadened scope 
designed to address new threats and vulnerabilities.

What will change?
Authorities will be required to focus more on identifying 
and reducing the risk of money laundering and terrorist 
ﬁ nancing, rather than relying on a system of inﬂ exible 
rules. The scope of the law will be extended to cover 
some new types of business, such as providers of 
gambling services, and there would be clearer rules on 
how ﬁ nancial institutions and other businesses deal 
with certain types of customers (such as high-ranking 
government oﬃ  cials).The rules for identifying the  ➜

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“

“Th  e Union is at the forefr ont of international eff orts to combat the 
laundering of the proceeds of crime. Flows of dirty money can damage the 
stability and reputation of the fi nancial sector, while terrorism shakes the 
very foundations of our society.”

Commissioner Michel Barnier (Internal Market and Services)

person who really owns a company will be tightened 
and made clearer, to ensure that criminals do not 
attempt to conceal their identities behind a company.

Who will beneﬁ t from these new rules?
Businesses and authorities would be able to better 
target their resources to deal with ever-changing 
threats. This should lead to more eﬀ ective measures 
in all 27 EU countries. Financial institutions will be 
able to apply less strict safeguards to customers, 
products and services they have identiﬁ ed as 
“low risk” and dedicate more resources into 
tracking higher risk customers and identifying the 

money launderers. The resulting improvements are 
intended to make the EU less attractive to money 
launderers, and thereby strengthen the EU ﬁ nancial 
system as a safe place to do business. (cid:31)

More information: 
http://ec.europa.eu/internal_market/
company/ﬁ nancial-crime/index_en.htm

1  See UNODC publication “Estimating illicit ﬁ nancial ﬂ ows 

resulting from drug traﬃ  cking and other transnational organized 
crimes”, October 2011  http://www.unodc.org/documents/data-
and-analysis/Studies/Illicit_ﬁ nancial_ﬂ ows_2011_web.pdf

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19

Infringements 

About infringement procedures
Th  e European Commission has powers to take legal action — known as infr ingement 
procedures — against a Member State that fails to meet its obligations under EU law. 
Th  ere are three steps to these procedures. Th  e fi rst is that the Member State receives a 
letter of formal notice and has two months to respond. If the Member State does not 
fully comply with EU legislation, the Commission can send a reasoned opinion. Again, 
the Member State has two months to reply. If there is no satisfactory reply, the Commission 
can refer the matter to the Court of Justice in Luxembourg. It can also ask the Court to 
impose a fi ne on the country concerned if it does not comply with the Court’s ruling.

Free movement of capital: Commission requests Bulgaria to 
respect EU rules
The  European  Commission  requested  Bulgaria  to  respect  EU  rules  on  the  free  movement  of 
capital. The Privatisation and Post-Privatisation Control Act in Bulgaria introduces special rights 
for the Bulgarian State which could restrict the free movement of capital. Under this Act, even when one of the 
company’s shareholders breaches privatisation obligations, the special rights allow the Bulgarian State to impose 
mortgages and other security measures on all assets of the company, irrespective of which shareholders were 
at  fault.  If  Bulgaria  does  not  abolish  these  special  rights,  this  might  deter  already  existing  EU  investment  in 
Bulgaria and dissuade others from investing in the future. As Bulgaria has not yet repealed these restrictions, the 
Commission requests Bulgaria, in the form of a reasoned opinion, to take action to fully comply with EU rules. If 
the Bulgarian authorities do not reply satisfactorily within two months, the Commission may refer the matter to 
the EU Court of Justice.

Defence Procurement: Commission requests Portugal to apply 
EU rules
The  European  Commission  requested  that  Portugal  fully  implement  the  Directive  on 
procurement  of  arms,  munitions  and  war  material  (and  related  works  and  services)  for 
defence  purposes,  as  well  as  the  procurement  of  sensitive  supplies,  works  and  services  for 
security purposes. The Defence Procurement Directive (Directive 2009/81/EC) had to be implemented in all EU 
Member States by 20 August 2011. However Portugal has only put part of the required provisions in place. The 
Commission’s request takes the form of a reasoned opinion under EU infringement procedures. If no measures 
are notiﬁ ed to put an end to the violation of EU law within two months, the Commission may decide to refer 
Portugal to the EU Court of Justice.

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