European Commission: Reform Needs in Professional Services

January 26th, 2017 § 0 comments

On 10 January 2017, the European Commission (EC) published a “Services Package” which aims at improving the services market across the EU (see press release). The Package contains a ‘Guidance on reform needs for Member States for regulation in professional services’ (see Communication and staff working document). It identifies opportunities for improving the regulatory environment. A restrictiveness indicator has been developed to analyse requirements of some regulated professions, including lawyers. The restrictiveness indicator is based on the following criteria:

  • Regulatory approach
  • Qualifications requirements
  • Other entry requirements
  • Exercise requirements

Chart on the restrictiveness as to the access and exercise of the profession of lawyer in all Member States:

Non-regulatory barriers are not reflected in the restrictiveness indicator.

Some of the recommendations concern all Member States, while others are also addressed to Member States not regulating a profession but where a risk of creation of new barriers was identified.

There are two recommendations that apply for all Member States:

  • All Member States reserving legal advice should clarify the scope of the reserves so as to facilitate the provision of legal consultancy services by lawyers or other service providers, in particular for online services.
  • All Member States should assess legal form and shareholding requirements, incompatibility rules and multidisciplinary restrictions, in particular taking into account the proportionality of these restrictions in relation to core principles, such as the independence of the profession, and to the corresponding supervisory arrangements. In addition, consideration should be given to the cumulative effect of such requirements in cases where their effects might be accentuated in the case of extensive reserves of activities (e.g. where legal advice is also part of the reserved activities).

The recommendations per profession identify needs for reform, some of which might have serious and even legal implications in cases where an infringement of EU law might be established.

The aim of the proposal for a proportionality test is ‘to ensure regulation is fit for purpose and does not create unjustified burdens’. It provides for a test to be used by Member States before adopting or amending national regulations of professions. Members States would have to thoroughly consider the need for regulation so as to fully appreciate the effects upon stakeholders and the broader business environment.

The Services package also contains a proposal for a services e-card and a proposal for a services notification procedure.

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