Reviewing entry restrictions and reserved activities of European professions

Transparency for Europe’s professions

Under the amended Professional Qualifications Directive 2005/36/EC Member States have a duty to review their  legislation and regulations dealing with access to and pursuit of their professions. The review must examine the justifications for limiting access to perform reserved activities to a particular professional group, against permissible criteria. The Member States are also supposed to analyse the barriers to entry to any profession and to consider alternative less restrictive regulatory mechanisms to protect the interests that the barriers are designed to serve. This will involve a profession by profession analysis of the regulations that restrict access to that profession. Issues such as the scope and number of reserved activities will be analysed in these reviews. These requirements are set out in the new Article 59(3) (introduced by Directive 2013/55/EU):

Article 59 (3) of Directive 2005/36/EC

 Member States shall examine whether requirements under their legal system restricting the access to a profession or its pursuit to the holders of a specific professional qualification, including the use of professional titles and the professional activities allowed under such title, referred to in this Article as ‘requirements’ are compatible with the following principles:

(a)

requirements must be neither directly nor indirectly discriminatory on the basis of nationality or residence;

(b)

requirements must be justified by overriding reasons of general interest;

(c)

requirements must be suitable for securing the attainment of the objective pursued and must not go beyond what is necessary to attain that objective.

These reviews are supposed to be completed by 18 January 2016. Once the national reviews are complete each Member State sends its report to the European Commission with an explanation and justification for any reserved activities/entry barriers. There is an on-going notification requirement of any new restrictions in the future (every two years).

These national reports will be sent to all the other Member States who will have six months to comment and the European Commission will then consult the professions concerned (probably in the case of lawyers via the CCBE – the Council of Bars and Law Societies of Europe).

In fact this process was kick started in November 2013 when the European Commission started a process of evaluation of entry requirements to the professions. Each Member State (MS) was supposed to have a national action plan in place by April 2015. These plans will review, at the national level, qualification requirements imposed on those wishing to join any regulated professions.

Since then the European Commission Communication on Upgrading the Single Market: more opportunities for people and business specifically refers to this mutual self-evaluation noting that

the regulation of similar professions varies substantially between Member States, as do reserves of activities.

It is expected that professions with major entry barriers or large areas of reserved activities will be under pressure to reform their regulatory systems. The European Commission noted that a major difference was that some States relied more on consumer protection guarantees, whilst other preferred regulatory controls on entry and reserved activities.

This European process may, in part,  have prompted the HM Treasury’s review of regulation in the UK where they say, of legal services:

The government will further reduce barriers so that it is easier for alternative business structures, such as supermarkets and estate agents, to offer legal services like conveyancing, probate and litigation in England and Wales. (A better deal: boosting competition to bring down bills for families and firms p.6)

The UK Government plans to launch a consultation by spring 2016 on

removing barriers to entry for alternative business models in legal services, and on making legal service regulators independent from their representative bodies. This will create a fairer, more balanced regulatory regime for England and Wales that encourages competition, making it easier for businesses such as supermarkets and estate agents among others, to offer legal services like conveyancing, probate and litigation. (A better deal p.12)

We shall see what comes of it and whether these national reports and reviews will be published and accessible in a timely fashion.


Text of Article 59 of Directive 2005/36/EC

Article 59 Transparency

  1. Member States shall notify to the Commission a list of existing regulated professions, specifying the activities covered by each profession, and a list of regulated education and training, and training with a special structure, referred to in point (c)(ii) of Article 11, in their territory by 18 January 2016. Any change to those lists shall also be notified to the Commission without undue delay. The Commission shall set up and maintain a publicly available database of regulated professions, including a general description of activities covered by each profession.
  2. By 18 January 2016, Member States shall notify to the Commission the list of professions for which a prior check of qualifications is necessary under Article 7(4). Member States shall provide the Commission with a specific justification for the inclusion of each of those professions on that list.
  3. Member States shall examine whether requirements under their legal system restricting the access to a profession or its pursuit to the holders of a specific professional qualification, including the use of professional titles and the professional activities allowed under such title, referred to in this Article as ‘requirements’ are compatible with the following principles:
(a) requirements must be neither directly nor indirectly discriminatory on the basis of nationality or residence;
(b) requirements must be justified by overriding reasons of general interest;
(c) requirements must be suitable for securing the attainment of the objective pursued and must not go beyond what is necessary to attain that objective.
  1. Paragraph 1 shall also apply to professions regulated in a Member State by an association or organisation within the meaning of Article 3(2) and any requirements for membership of those associations or organisations.
  2. By 18 January 2016, Member States shall provide the Commission with information on the requirements they intend to maintain and the reasons for considering that those requirements comply with paragraph 3. Member States shall provide information on the requirements they subsequently introduced, and the reasons for considering that those requirements comply with paragraph 3, within six months of the adoption of the measure.
  3. By 18 January 2016, and every two years thereafter, Member States shall also submit a report to the Commission about the requirements which have been removed or made less stringent.
  4. The Commission shall forward the reports referred to in paragraph 6 to the other Member States which shall submit their observations within six months. Within the same period of six months, the Commission shall consult interested parties, including the professions concerned.
  5. The Commission shall provide a summary report based on the information provided by Member States to the Group of Coordinators established under Commission Decision 2007/172/EC of 19 March 2007 setting up the group of coordinators for the recognition of professional qualifications, which may make observations.
  6. In light of the observations provided for in paragraphs 7 and 8, the Commission shall, by 18 January 2017, submit its final findings to the European Parliament and the Council, accompanied where appropriate by proposals for further initiatives.

Directive 2013/55/EU of the European Parliament and of the Council of 20 November 2013 amending Directive 2005/36/EC on the recognition of professional qualifications and Regulation (EU) No 1024/2012 on administrative cooperation through the Internal Market Information System ( ‘the IMI Regulation’ )

UK HM Treasury Paper, A better deal: boosting competition to bring down bills for families and firms (Cm 9164, November 2015)

European Commission, Upgrading the Single Market: more opportunities for people and business  COM(15) 550 final

European Commission, Transparency and mutual evaluation of regulated professions,  See diagram below.

 

timetable-for-the-transparency-and-mutual-evaluation_en

Julian Lonbay

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