Access to Services and Services Markets

Services account for about 70% of the EU’s economy, 70% of employment and 90% of new jobs.

The single market for services is still incomplete – cross-border trade and investment in services considerably lags behind that of goods. Not all services can be traded easily across borders. This is mainly due to the remaining regulatory and administrative barriers that hinder cross-border trade and investment in services. These barriers are a major factor limiting the availability of services for EU consumers and businesses.

The Services Directive sets out rules to facilitate the cross-border provision of services and the right of establishment. The Professional Qualifications Directive lays down rules on the recognition of professional qualifications so that a professional from one EU country can practice and provide services in another EU country.
Given the importance of services for the EU economy and the significant opportunities they offer for increased trade and investment, reducing barriers has great potential to deepen the single market.

The following sections provide indicators on specific areas of services.

Industry is a major buyer of business services, such as legal, accounting, and tax advisory services. These services play a crucial role in the overall competitiveness of the EU’s industrial ecosystems. Business services are also a major driver of new business models and the digital and green transitions of the EU economy. The performance of the single market for services also influences the potential of many EU small and medium-sized enterprises (SMEs) to expand and conduct business across borders.

Barriers to access to professional services markets

The EU restrictiveness indicator (EURI) measures the level of regulatory restrictiveness on a scale from 0 (least restrictive) to 6 (most restrictive) for the cross-border provision of services and the right of establishment for seven groups of professional services with a high share in EU firms’ intermediate consumption(the value of the goods and services consumed as inputs by a process of production) or cross-border mobility. These are accountants (including tax advisers), architects (including landscape architects and interior designers), civil engineers, lawyers, real estate agents, patent agents and tourist guides. The indicator is based on assessments carried out by the Commission and verified with Member States authorities.

In the area of professional services, the Scoreboard shows little if any progress in reducing regulatory barriers for entry and exercise of professions between 2017 and 2021. Although some Member States introduced limited reforms, others increased restrictions. Compared to 2017, the EU average EURI values have either remained the same for all monitored professions in 2021. The values have even slightly increased (meaning more regulations) for tourist guides, real estate agents and travel agents.

In this context, the European Commission issued country specific reform recommendations as part of the European Semester and in the communications of 2017 and 2021 (Communication ‘On taking stock of and updating the reform recommendations for regulation in professional services of 2017’, July 2021).

Legal services remain the most protected profession in the single market (of those monitored). This has negative consequences for industrial competitiveness because all EU companies, including SMEs, devote a significant share of their intermediate consumption to legal services. The average EURI score for legal services remains at 3.4, with little if any improvement in the last 5 years; most EU countries are above the EU average (and 10 countries score 3.0 or higher). Architects, civil engineers and patent agents are also well protected from competition in the single market – the EURI scores for these professions are relatively high at 2.5, 2.4 and 2.2 respectively.

Reporting period: 2017, 2021

Source: European Commission, EURI database
 

The Professional Qualifications Directive (Directive 2005/36/EC) is the cornerstone of the EU mechanism for mutual recognition. Furthermore, Proportionality test Directive (Directive (EU) 2018/958) states that before new professional requirements are introduced or existing ones amended, EU countries should conduct a proportionality test to assess the impact of these measures against clear criteria and ensure they are proportionate and suitable for achieving legitimate policy objectives.

The Professional Qualifications Directive specifies two systems of professional recognition:

General system

Professionals wishing to work in another EU country need to apply to the relevant authority in the country to where they are moving in order to have their qualifications recognised.

The authorities examine the duration and content of the professional training attested by their diploma(s) and any accompanying documents. They must assess if there are any significant differences between their training and the qualifications required to practise the relevant profession in the host country.

If there are significant differences, the authorities can impose compensatory measures on the applicant. For instance, the applicant might have to take a test or complete an adaptation period (a period of supervised practice in that country under the responsibility of a qualified member of that profession, possibly accompanied by further training).
 

Automatic recognition

This system, which does not allow for compensatory measures, covers a limited number of professions:
•    health professions (doctors, nurses, dentist, pharmacists, veterinary surgeons),
•    architects.

Applicants from either category must meet the minimum training requirements set out in the Directive.
Certain professionals in trade, industry and business can also have their qualifications recognised automatically if they meet minimum professional experience requirements. For more details, visit the Commission’s free movement of professionals page.
 

Performance indicator on the recognition of Professional Qualifications

This indicator refers to decisions taken by host country authorities on professionals who, having qualified in another EU country, apply for their qualifications to be recognized in the host country so they can practice there in the long term.

Recognition rates by EU countries: The indicator measures the positive recognition rates as a percentage of all requests received by the host country from all other EU countries between 2019 and 2021 for all regulated professions reported in the Regulated Professions Database. It delves into the role of recognition of qualifications for access to regulated professions by presenting performance by EU country. In general, a relatively high response and recognition rate means it is easier and/or cheaper for professionals to have their qualifications recognised.

At EU level between 2019 and 2021, of the 102 782 cases recorded in the regulated professions database:
•    71% (73 461) were concluded by a decision of recognition,
•    10% (10 172) were concluded by a decision of non-recognition,
•    the remaining 19% (19 149 cases) were either unsettled (no decision taken), under examination or subject to appeals.
 

Recognition rates vary between EU countries and depend on several factors. These factors include the resources available to manage applications and the attention given to them, the number of applicants and the complexity of the rules concerned. The highest recognition rates are in Estonia (100% of 154 cases), Czechia (99.65% of 2 572 cases), Slovakia (99.55% of 1 324 cases) and Poland (99.03% of 516 cases). The lowest rate are in Italy (34.90% of 20 406 cases), the Netherlands (58.04% of 9 777 cases) and Latvia (67.31% of 52 cases).

Efficient and reliable postal services are a vital part of communication services in the EU affecting everyone’s daily lives as well as all business sectors. Other sectors such as e-commerce, publishing, mail order, insurance, banking and advertising depend on the postal infrastructure.

Employing about 1.5 million people, the postal services – including express services – are a major source of jobs in the EU.

Postal Services and the Single Market – why does it matter?

The aim of the Postal Services Directive  is to ensure that affordable, high quality and efficient postal services are available throughout the EU. The Directive sets out minimum objectives for postal services and sets out a regulatory framework for EU postal services.

For postal services, the price indicator shows the increasing impact of digitalisation on letter mail. Prices for a priority letter in 2021 are 35% more expensive than in 2016. This increase partly compensates for the loss of revenue from falling volumes and higher costs due to inflation. However, the quality of service in the single market has remained stable on average: 84% of domestic priority letters reach the final recipient by the next day.

More information on postal services

Under the universal service obligation, Member States must ensure a basic postal service is available to all members of the public at an affordable price. The obligation includes collecting, sorting, transporting and distributing letters weighing up to 2 kg and parcels weighing up to 10 kg. Deliveries are performed at least 5 working days a week.

More information about Postal services.