INTERNAL MARKET
The internal market as an objective
of the EU
• Article 3 TEU: The EU’s aim is to promote peace, its
values and the well-being of its people.
• Article 3, para 2: The Union shall establish an internal
market.
• Article 3, para 1 TFEU: The EU shall have exclusive
competence in the following areas: a) customs union, b)
the establishing of the competition rules necessary for
the functioning of the internal market.
• Article 4,para 2 TFEU: Shared competence between the
Union and the Member States applies in the following
principal areas: a) internal market…
THE CONCEPT OF THE
INTERNAL MARKET
• Article 26 TFUE: The internal market shall comprise an
area without internal frontiers in which the free
movement of goods, persons, services and capital is
ensured in accordance with the provisions of the
Treaties.
• The Council, on a proposal from the Commission, shall
determine the guidelines and conditions necessary to
ensure balanced progress in all the sectors concerned.
• Article 27 TFEU: The Commission has to take into
account the extent of the effort that certain economies
showing differences in development will have to sustain
for the establishment of the internal market.
Overview of the four freedoms
• Free movements of goods: the “cornerstone” of
the internal market/ For many MS a primary
reason for membership/it applies to all goods,
including goods imported from outside the
EU/Common commercial policy based on a
customs union/ prohibition of customs duties and
of quantitative restrictions/States are required to
adjust any state monopolies of a commercial
character.
• Free movement of person: a right to leave, or
enter and reside in a MS for the purposes of
work or establishment and the right to be treated
without discrimination/ Derogations on the
ground of public policy, public security, and
public health/ Employment in the public service.
• Freedom to provide services: movement or not
movement of a person to provides services
(insurance).
• Free movement of capital: distinction between
payments and capitals and between MS and
third countries/ Public- policy exceptions.
Common themes in the free
movement provisions
• Economic activity: in the earlier years, the nondiscrimination principle was linked to an
economic activity/ With the introduction of the
EU citizenship, the need for an economic link
began to dilute.
• Internal situation and migration: The principle:
the EU law has no application to purely internal
matters/ Exceptions: in relation to citizenship/
Reverse discrimination.
• Discrimination and access to the market: The
prohibition of discrimination on the grounds of
nationality applies to all forms of discrimination,
both overt and covert (residence or length-ofresidence requirement)/ Moreover, the ECJ
looks to the effect of a national measure
(creation of an obstacle), even not overtly or
intentionally protectionist/ unless are “objectively
justified” as necessary to safeguard vital
interests.
• Direct effect: Although the free-movement provisions are
addressed to MS, all the main articles have been found
to be directly effective and thus may be invoked by
individuals. Whether, all the treaty freedoms are
horizontally effective is less clear.
• Need for harmonization: The Treaty derogations and the
exceptions accepted by the ECJ can jeopardize the
functioning of the single market. White Paper, 1985, a
massive harmonization program, designed to provide
common standards of protection (114-117 TFUE). The
so-called open method of coordination (OMC) aims at
lessening the regulatory burden of businesses.
The social dimension
• In addition to the right of free movement, the
Treaty seeks to increase the social protection.
• Worker’s protection is ensured by the principle
of non-discrimination.
• EU employment legislation is to harmonize
national laws. Harmonized standards create a
level playing field. Otherwise, MS with lower
standards will have a competitive advantage.
• EU social rights aim at promoting the well-being
of EU citizens. EU measures complement rather
than replace national provision, according to the
principle of subsidiarity.
Completion of the internal market
Single market Act I (13.4.2011). The Commission
announced twelve key actions (a single market for
venture capital, a better system of recognition of
professional qualifications, a unitary patent system,
faster solutions to disputes, a cross-border use of
electronic identification etc.
Single market II (1.10.2012). The Commission identifies
four drivers around which to focus key actions: 1.
Developing fully integrated networks (energy and
transport), 2. Fostering mobility of citizens and business
across borders, 3. Supporting digital economy across
Europe, 4. Strengthening social entrepreneurship,
cohesion and consumer confidence.