The EU approach is not without defects. The single market remains an uncompleted process: financial services and public procurement are still far from being liberalized, compliance levels vary considerably between member states and anti-competitive practices abound” (Leach 2000)<sup>**13**</sup> .

Leach (2000) argues that a vigorous program of mutual recognition of standards might have been at least as successful in promoting economic activity as the harmonization policies followed.<sup>**14**</sup> Pelkmans, Vos and Di Mauro (2000) worry about the numerous Euopean standards created in some sectors and wonder if they have been subjected to a cost-benefit test to assess if they are contributing to economic optimality. They also point out that, in spite of the considerable efforts since the mid-1980s towards liberalizing, approximating standards, and applying mutual recognition; mutual recognition is still facing considerable practical problems and there is a worrying trend toward ever increasing national product regulation. This concern is shared by Pelkmans (2002) who criticizes the modest contribution of the principle of mutual recognition to the realization of free movement in the single market. He argues that business in the EU have been somewhat disenchanted by the many costs and uncertainty in its application in practice.<sup>15</sup> Businesses find it difficult and uncertain to verify the “equivalence” of objectives of health and safety between members.<sup>16</sup> This is further aggravated by the absence of sectoral rule books and the next-to-prohibitive costs of monitoring the application of the principle. Pelkmans concludes that the solution consists of greater mutual recognition: the manifold benefits of mutual recognition for Europe are too great to allow the present ambiguities to continue. The Union needs much more pro-active approaches to reduce the costs of mutual recognition as well as permanent monitoring structures for its application to services (analogous to those already successfully functioning in goods markets). Above all, what is required is a "mutual recognition culture" so that the EU can better enjoy the fruits of its own regulatory ingenuity (2002:2).

This mutual recognition culture among national authorities would stimulate permanent exposure to healthy competition throughout the EU market, without sacrificing justified health, safety and consumer protection concerns (Pelkmans 2002). This does not imply forgetting about harmonization. As Pelkmans notes, total liberalization, harmonization and mutual recognition all have limitations and no single method can suffice for all cases.

> 13 Quote taken from Single market definition at http://www.euro-know.org/dictionary/s.html

> 14 http://www.euro-know.org/dictionary/s.html

> 15 Pelkmans notes that “[d]uring the mid-nineties the disenchantment with MR [Mutual Recognition] was so strong that that UNICE (the European confederation of industry) recommended a return to harmonization as a superior option” (2002:3)

> 16 An analysis of the difficulties of determining and proving equivalence under the principle of mutual recognition can be found in Gardeñes-Santiago (1999).

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