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Rethinking British attacks on EU red tape

In the last 15 months since David Cameron’s speech on Europe, the issue of EU red tape (i.e. EU rules imposing unnecessary costs on businesses) has featured prominently on political and media agendas. Initiatives such as the “Cut EU red tape” report by the Business Taskforce in October 2013,[1] and the ongoing balance of competence exercise[2] have helped propagate two ideas: first, that EU regulations are almost inherently wasteful. Second, that the British government is fighting the good fight to do away with red tape. [3] This echoes earlier British campaigns for deregulation at EU level in the 1990s and in early 2000s.[4] Interestingly, while other Conservatives decry red tape, London’s mayor Boris Johnson recently made the case that Brits are not “the bad boys of Europe”:[5] other countries, such as France, are. He puts forward another criticism: too few Member States implement EU legislation correctly. This undermines the Single Market and creates unfair competition for businesses operating in law-abiding Member states such as the UK. As with red tape this attention to other Member States’ compliance record is not new, as Britain led the way in asking for tougher rules on non-implementation in the 1990s.[6]

Are these two criticisms compatible? The tensions between asking for more leeway for Britain (and other Member States) to set their own rules, while expecting to reap the benefits from a fully functioning Single Market (and fully implemented EU rules) are well known:[7] if all Member States were to opt out of every policy they deemed not directly in their own national interest, there would not be a “common” Market left. Yet in this post I argue these two criticisms can indeed be compatible, and be both addressed under certain circumstances.

Is the issue with the “EU” or with “red tape”?

When analysing British attacks on EU red tape, it is useful to identify which is the predominant problem: the fact that rules originate at EU level, or the fact that they create red tape. Britain differs from other Member States by the high salience of European affairs in its media – meaning British EU policies face much more scrutiny (and criticism) than their counterparts on the continent.[8] This means that questions on sovereignty feature almost permanently in the media. But the red tape element matters even more. First, the current government hunt for red tape goes well beyond EU rules (e.g. the Red Tape Challenge).[9] Second, rules of British origin are only considered better than their European counterparts’ when they are looser, that is when they impose less restriction on businesses. If British decision-makers decide to complement EU rules with additional measures to meet local concerns when transposing[10] EU directives they are not praised for adapting a common EU rules to British conditions – instead they are charged with gold-plating and asked to stick to the letter of the European law[11].

If we consider that red tape matters more than the origin of a law, then this opens the way for the resolution of the British paradox exposed above. A way to address both criticisms and to obtain both a reduction in red tape and a better functioning Single Market. The solution, I argue, is to change the way we legislate at EU level, shying away from one form of EU law, directives, and developing the use of another form of EU law, EU regulations.

Implementing directives at the source of both problems

Why reduce the use of directives? EU regulations have direct effect. This means that once agreed on by the Member States and the European Parliament in Brussels they automatically enter each Member States’ national law book. Directives on the other hand require transposition. This means that each Member States has to pass primary or secondary legislation to implement the directive. To a certain extent, this transposition process is at the heart of the two criticisms. Firstly, not all Member States will transpose within the time allotted for transposition in the directive. This means Member States treat businesses and in some cases citizens differently for the period of time (from a few months to many years) it takes for all of them to apply the rule. This difference of treatment undermines the Single Market. A prime example of this is the recent changes in the size of cages allowed for caged hens. Most British producers met the target to increase the size of cages in the time allotted (13 years after the directive was voted); while other Member States such as France, Spain and Poland lagged behind, and were able to undercut British farmers with their lower welfare eggs.[12] Secondly, even when all Member States transpose the directive on time, the process itself may lead to red tape. Indeed, although not all transposition necessarily leads to gold-plating;[13] chances are Member States will interpret the directive differently – instead of having one common rule, the process leads to the creation of 28 variations on a common rule, imposing additional costs on business which operate in more than one Member State. In a sector such as the environment where directives are the predominant legislative tool, a shift toward regulations would dramatically reduce the time and cost of application.[14]

Conclusion

Using regulations, and not directives, will not be a panacea. This may only be a small part of the solution, and the use of regulations may generate further negative press coverage in Britain. But highlighting how the implementation of directives plays a key role in the creation of EU red tape is crucial: it reminds us that an important share of the red tape emerges in the Member States – not in Brussels. While the European Commission reports progress in its administrative burden reduction programmes,[15] it is now time to turn to each Member State, asking them to take their responsibilities. The hunt for “EU” red tape starts at home.

 

 


[1] https://www.gov.uk/government/publications/cut-eu-red-tape-report-from-the-business-taskforce

[2] https://www.gov.uk/review-of-the-balance-of-competences

[3] For a dissenting voice, see Ken Clarke’s position in the Guardian in January 2014

[4] http://www.dailymail.co.uk/news/article-202736/Brown-attacks-wasteful-EU-red-tape.html

[5] http://www.telegraph.co.uk/news/worldnews/europe/eu/10656900/Were-not-the-bad-boys-of-Europe-just-ask-our-ski-instructors.html

[6] Jordan, A. and Jeppesen, T., 2000, “EU environmental policy: adapting to the principle of subsidiarity?” European Environment, 10, 64-74, available here

[7] Ibid.

[8] Opperman, K. and Viehrig, H., 2008, “Issue Salience and the Domestic Legitimacy Demands of European Integration. The Cases of Britain and Germany”, EIoP, vol 12, accessible here

[9] http://www.bbc.co.uk/news/business-25903681

[10] Transposition is the process through which European directives enter each Member States legal system: laws or statutory instruments are adopted by the Parliament or government in order to translate the directive into national law

[11] See for example the House of Commons 2008 report on the implementation of the 1991 Nitrates directive in England http://www.publications.parliament.uk/pa/cm200708/cmselect/cmenvfru/412/412.pdf

[12] http://www.independent.co.uk/news/uk/home-news/the-end-of-battery-farms-in-britain–but-not-europe-6281802.html

[13] Indeed, a report in 2013 argues gold-plating is a thing of the past: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/137696/bis-13-683-gold-plating-review-the-operation-of-the-transposition-principles-in-the-governments-guiding-principles-for-eu-legislation.pdf

[14] http://www.endseurope.com/index.cfm?go=30134&referrer=search

[15] http://europa.eu/rapid/press-release_IP-13-836_en.htm



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