Comments by the Norwegian Government 29 November 2004

Publisert under: Regjeringen Bondevik II

Utgiver: Nærings- og handelsdepartementet

Comments by the Norwegian Government 29 November 2004

Introductory comments

Barriers to trade in the European market for services may hamper the potential for growth and employment. Norway therefore welcomes the proposal for a directive on services. However, the Norwegian Government believes there is scope for clarifying the draft directive on several points. There is also a need to clarify the role to be played by the national authorities in protecting important public interests in the country where the service is performed. Consideration should be given to protection of the environment, working conditions, health and safety, consumer protection and local democracy. Important instruments of national management should be upheld.

The Country of Origin Principle

General comments

Norway appreciates that the country of origin principle is a means to facilitate the free movement of services. However, due to the wording of the present proposal, it is difficult to fully determine what the consequences of Article 16 would be, in particular in relation to national measures not having a restrictive effect on the access to market. Hence, there is a need to clarify to what extent the proposed directive would affect national private law regarding e.g. torts and contracts, or public law measures concerning planning permissions and environmental protection concerning the exercise of services. There is also a need to clarify to what extent the current wording restricts the host State’s competence to regulate and supervise service activities on its territory, in particular in areas outside the scope of existing harmonisation measures.

Norway would like to underline the importance it attaches to public concerns like protection of the environment, working conditions, health and safety, consumer protection and local democracy. It is important that the directive strikes an appropriate balance between the country of origin principle and these public concerns as set out in Article 16 and the derogations in Articles 17-19. On this basis, Norway proposes amendments to some of the derogations of the draft directive, as set out below.

Environment

The scope of Article 17 (17) seems too narrow to serve as a basis for requirements generally recognised as necessary for protecting the environment. Norway proposes the following amendment to Article 17 (17): “specific requirements of the Member State to which the service provider moves, that are directly linked to the characteristics of the place or the effects of the service provided and with which compliance is necessary for reasons of public policy, or public security or for the protection of consumers, public health or the environment.” See also comments on consumer protection below.

Furthermore, Norway proposes that Article 19 (1) should be amended to specify environmental concerns as one of the reasons justifying derogations under this article by including a new letter d) that reads: “ the protection of the environment”

Health services and assumption of health costs

Norway is concerned about the consequences of the country of origin principle for health services. We are in particular concerned about the uncertainty as to what extent Norwegian regulation of the quality and safety of health services will apply. Moreover, we would underline the importance of supervising health care providers and services provided in order to maintain a high level of quality.It is important that the directive allows for adequate supervisory measures and that this is further clarified.

The proposed directive should not prevent Member States from controlling public costs relating to health services, e.g. by deciding to what extent and under what conditions private operators may provide services funded by the social security system. A clarification of the connection between the provisions of Article 16 (3) (i) and Article 23 would be useful. Save in situations regulated by Article 23, the directive should only regulate access to the service activity, not access to public funds as such.

In the definition of “hospital care” in Article 4 (10), it should be taken into consideration that certain health services, for instance services that require specialised equipment or competence, are provided to out-patients within a hospital structure.

Norway also proposes that a new derogation concerning national legislation on patients’ rights should be added in Article 17, as this is a central element of national health policy.

It is important that existing national regulation of the use of biotechnology in human medicine is maintained. The present wording of Article 17 (16) only covers services subject to a total prohibition. This derogation, which is seen as relevant inter alia in order to restrict the cross-border provision of certain health services, should also cover areas in which there is restrictive national regulation. Norway therefore proposes replacing the word “total” with “general” in Article 17 (16). It should also be emphasised that the term “public policy” is understood to cover ethical considerations as well as considerations of human dignity and personal integrity.

Consumer protection

Consumer confidence is of vital importance if the directive is to attain its objectives. With this in mind, Norway proposes amendments to Articles 17(17) as set out above and (26) as set out below.

Furthermore, there may be some inconsistency between Article 17 (21) and other legislation where the country of origin principle is not applied. Insofar as the rules governing consumer protection are harmonised in accordance with a principle other than the country of origin principle, the services directive must include an exemption that corresponds to the exemption from the country of origin principle. In any case, any inconsistency in relation to specific directives that do not have a country of origin clause should be clarified.

In order to ensure that the recipient has adequate information to make a well-informed choice among service providers, it would be beneficial if the recipient also had access to information about the rights and obligations under the applicable legislation. To this end, Norway suggests three amendments to Article 26:

  • Firstly, that the proposed Article 27 (2) should instead be included as a new letter (h) in Article 26 (1) that reads: “(h) information on the insurance or guarantees referred to in Article 27 (1), and in particular the contact details of the insurer or guarantor and the territorial coverage;”
  • Secondly, that the proposed Article 28 (1) should instead be included as a new letter (i) in Article 26 (1) that reads: “(i) information on the existence or otherwise of an after-sales guarantee, on its content and on the essential criteria for its application, in particular its period of validity and territorial cover.”
  • And thirdly, that a new letter (e) should be added to Article 26 (3) that reads: “(e) the recipient’s rights and obligations under the legislation which would govern the service, in particular time limits for complaints, language requirements, available sanctions in cases of breach of contract, and settlement of disputes as well as other relevant provisions relating to the exercise of a service activity, including health and safety requirements as referred to in Article 16 (1).”

Safety and working environment - Posting of workers

Article 17 (5) of the proposal ensures coherence with Directive 96/71/EC concerning the posting of workers by exempting all matters coming under Directive 96/71 from the application of the country of origin principle. Directive 96/71 stipulates that companies posting workers within the internal market shall guarantee the terms and conditions of employment of the Member State in which the workers are posted. The host Member State is responsible for the enforcement of these terms and conditions. From our point of view, this is crucial in order to ensure safe and secure working conditions and to prevent social dumping.

It is very important that the directive does not lower the standards relating to health, working environment and safety in the host Member State. However, the draft directive leaves some ambiguity, e.g. due to the fact that Directive 96/71 is not exhaustive. It is therefore important that the future directive clarifies that the service provider must comply with relevant national legislation regarding health, working environment and safety in the host Member State. In the area of labour law and workers’ health and safety, the country of origin principle also seems to set aside legislation in the host Member State that is not based on implementation of the Posting of Workers Directive.

Norway takes note of the additional requirements set out in Articles 24 and 25 and believes that these articles are important to simplify the operating conditions for enterprises. These provisions cannot minimise the host Member State’s ability to control the service provider in terms of ensuring a safe and secure service operation, in particular when it comes to service providers operating within potentially high-risk industries in the host Member State. Norway recognises the need for co-operation between the relevant supervisory authorities and welcomes the proposal in Article 24, which requires the Member State of origin to assist the authorities of the host Member State in the supervision of its companies operating in other Member States.

Recovery of debts

Article 18 (1) and (2) concern transitional derogations with respect to recovery of debts. Norway is in favour of derogations from the country of origin principle in this sensitive area. Recovery of debt services should be closely monitored by the host State, and the activity should also be subject to regulation that caters for both the creditor’s and debtor’s interests and for the service provider’s interests. If the efforts to harmonise these services are unsuccessful, it is important that the country of origin principle as foreseen by Article 18 (2) is not invoked. Norway therefore proposes that the reference to recovery of debts in Article 18 (2) should be deleted. These services should be regulated in Article 18 (3). The above reasoning is equally valid for the extrajudicial recovery of debts. Consequently, Norway proposes that this form of debt recovery should be covered by the same exemption as judicial recovery of debts.

Gambling activities

Article 18 (1) b) and Article 40 (1) b) foresee a common European market for gambling services. This will entail the establishment of a new competitive gambling market in Europe. A more liberal gaming and gambling market could lead to aggravated social problems related to gambling. A derogation from the directive for gambling activities that is parallel to the derogation laid down in the directive on “e-commerce” should be considered.

Trade in alcoholic beverages

Existing regulations on trade in alcoholic beverages in Norway include among other things the requirement for a licence in order to retail or serve alcohol, a state retail monopoly and a prohibition with respect to the advertising of alcoholic beverages. Norway interprets the proposal as not affecting such national legislation.

Administrative simplification and co-operation

Norway supports the proposals aimed at simplifying administrative procedures for the establishment of service providers, inter alia by way of designating single points of contact. Norway welcomes the provisions calling for mutual assistance and co-operation between Member States and the Commission regarding surveillance and supervision. Electronic procedures would provide efficient communication in this context, and the experience gained from the Solvit network will prove valuable when designing an adequate electronic system.

As regards Chapter II, Sections 2 and 3, Norway would welcome a clarification of the scope of the provisions. In particular, there is a need to clarify the prohibition of “authorisation schemes” related to “access to a service activity or the exercise thereof”. For example, do the provisions related to authorisation schemes address all conceivable authorisation schemes, including schemes of a general nature that apply to all activities and businesses regardless of whether or not they are service activities, such as VAT registers and registers of business enterprises? Furthermore, it should be clarified whether the said provisions cover authorisation schemes linked to specific parts of service activities or specific parts of the territory. Norway nevertheless takes note of the principle that proportionate ethical, public and professional considerations can be justified on the basis of the criterion “overriding reason relating to the public interest”.

Norway agrees with the purpose of Article 13 (4) and (5) c). There is, however, a need to further analyse the effects of these provisions and their necessity in addition to the obligation set out in Article 13 (3). In this respect Norway interprets the proposed Article 13 (4) as coherent with common principles of public law, such as overriding public health and safety requirements and the general obligation to protect the environment. These principles and obligations are important cornerstones of the EU treaties as well, and constitute several of the basic union objectives set out in the Constitutional Treaty Article 3. Common procedural rights should also be observed in situations covered by Article 13 (4), including the right to complain and to obtain reversal of a decision, e.g. with regard to third parties’ standing in cases where there are a limited number of available authorisations.