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Stakeholders welcome "Goods Package"

Marketing a product in another country is not always an easy feat. In order to tackle certain problems in this area, the European Parliament's Committee on the Internal Market and Consumer Protection held a public hearing on Tuesday on the so-called "Goods Package", a proposed Commission law expected to have a major effect on the Internal Market.

Speaking on behalf of the Commission's Enterprise and Industry DG, Heinz Zourek pointed out the importance of this package to the internal market for goods. One of the main problems addressed by the proposal is the "principle of mutual recognition" in the area of non-harmonised goods (25 percent of products on the market), according to which an EU state may not refuse market access to a product lawfully marketed in another Member State, unless public health and safety concerns are at stake. Although the principle was set out in the 1979 Cassis de Dijon judgement of the ECJ, it has been undermined in recent years.

Clear rules on "mutual recognition"

The Goods Package, explained rapporteur Alexander Stubb (EPP-ED, FI), aims to establish a tighter definition for the mutual recognition principle and to offer greater legal clarity - this, in order "to facilitate free movement of goods while keeping some safeguards". Furthermore, it attempts to shift the burden of proof to Member States, whereas it currently lies with the manufacturer. According to Mr Stubb, examples of failure to apply the principle of mutual recognition are numerous. "Three hundred cases have gone through the European Court of Justice", he said. "With regards to bikes, for instance, there might be certain safety regulations in one country, while in another country you require a light with a dynamo system and two hand breaks." The company, in this case, would have to modify its product accordingly and the extra-costs might end up amounting to one percent of its turnover, Mr Stubb explained.

Prof. Rodolphe Muñoz (from the Universities of Liège and Lille) called mutual recognition "the backbone for the free movement of goods". Recounting an example from Germany, Mr Muñoz said that there was a regulation which went back to 1516 which provided a definition of what beer was. "If there was no mutual recognition, what would happen is that French or Belgian beer could not be called "beer"; the other option would be to get a decision at European level on how beer can be defined", he explained. Mr Muñoz welcomed the proposal since it furthered dialogue between national authorities and manufacturers, but also expressed his scepticism as to its potential effectiveness.

Jean-Paul Mingasson, general adviser of BUSINESSEUROPE, also underlined that the enforcement of the mutual recognition principle, "the main pillar for free trade", needed to be improved. "28 percent of companies in intra-community trade encounter trade barriers [...having] to do with the principle of mutual recognition, but only 5 percent of them try to do something about it", Mr. Mingasson summarised. Most companies simply gave in when they ran into these problems, he added. This frequently led to highly expensive double-certification or the need to repackage/reformat a product - or, worse yet, withdrawal from the market in question.

The Danish experience: Opening up market benefits all

Finn Lauritzen, from the Danish National Agency for Enterprise and Construction, cited the need to further open Member States' markets, since "consumers suffer directly from insufficient competition and indirectly from insufficient productivity". "The traditional view is that more openness will be to the detriment of national producers while benefiting consumers and therefore conventional wisdom says that a balance must be found between these", Mr. Lauritzen explained. The Danish experience, however, shows that "more openness actually keeps national industry on its toes, thereby improving competitiveness and benefiting both enterprises and consumers" with mutual recognition playing a significant role.

Some MEPs were more sceptical of the benefits of mutual recognition as such. Jacques Toubon (EPP-ED, FR) remarked that the hearing appeared to be "a big mutual recognition fest", doubting that the principle was really so important to companies. In addition, Mr Toubon argued that the proposal placed too many obligations on Member States and too few on producers.

Common legal framework for harmonised goods

In the area where harmonised rules apply to goods - accounting for 75 percent of products in the EU - the proposal aims to set out a common legal framework and to strengthen the rules on market surveillance.

Paul Coebergh van den Braak, of Philips, said that regulation creates a level playing field for manufacturers, "provided that all economic actors are held to it". Ideally, he said, there should be one set of requirements, one test and one procedure for market access all across the globe. "The EU should focus on enforcement of European regulations, further improvement of European regulations and promotion of global harmonisation", he suggested, emphasising the importance of active surveillance including import controls and measures against faulty products. He said that inasmuch as his company generally welcomed the package, administrative burdens for industry should be limited to what was really needed.

Jim Murray, Secretary General of the BEUC European Consumers' Organisation, welcomed the strengthening of rules on market surveillance and enforcement. He complained, however, that the proposed legislation did not task Member States with checking compliance with regulations. Furthermore, Mr Murray recommended the abolition or radical reform of the CE-mark (conformité européenne), rather than the organisation of an information campaign to clarify its meaning, as suggested in the proposal.

The Internal Market Committee will discuss the proposal over the following months. A plenary vote is anticipated in the late fall.

(Europäisches Parlament;
5. Juni 2007)

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