Explanatory Memorandum to COM(2018)373 - Mechanism to resolve legal and administrative obstacles in a cross-border context - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2018)373 - Mechanism to resolve legal and administrative obstacles in a cross-border context. |
|---|---|
| source | COM(2018)373  |
| date | 29-05-2018 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
One of the main objectives of the Union is the promotion of its overall harmonious development. The Union shall therefore develop and pursue its actions leading to the strengthening of its economic, social and territorial cohesion. In particular, the Union shall aim at reducing disparities between the levels of development of the various regions and the backwardness of the least favoured regions (Article 174 of the Treaty on the Functioning of the European Union ('TFEU'), among which "particular attention shall be paid to (…) cross-border (…) regions". The Union and its immediate neighbours in the European Free Trade Association ('EFTA') currently have forty internal land borders.
Since 1990, Interreg 1 funding has supported cross-border cooperation programmes in EU border regions including those with EFTA countries. It has financed thousands of projects and initiatives that have helped improve European integration. The main achievements of Interreg programmes include: increased trust, greater connectivity, improved environment, better health and economic growth. The 2014-2020 legal framework allowed the European Regional Development Fund ('ERDF') under Interreg programmes to support projects 'enhancing institutional capacity of public authorities and stakeholders and efficient public administration by promoting legal and administrative cooperation and cooperation between citizens and institutions' 2 . Since it was set up Interreg has also supported the completion of the internal market 3 . In recent decades, the European integration process has helped internal border regions to transform themselves from mainly peripheral areas into areas of growth and opportunities. The completion of the Single Market in 1992 has boosted EU productivity and reduced costs through the abolition of customs formalities, harmonisation or mutual recognition of technical rules and lower prices as a result of competition; intra EU trade has increased by 15% over 10 years; additional growth has been generated and around 2.5 million more jobs have been created.
However, in a 'Cross-border review' 4 , lasting more than two years, the Commission gathered evidence that border regions generally perform less well economically than other regions within a Member State. Access to public services such as hospitals and universities 5 is generally lower in border regions. Navigating between different administrative and legal systems is often still complex and costly. Individuals, businesses, public authorities and non-governmental organisations have shared with the Commission their at times negative experiences of interaction across internal borders. As a consequence the Commission adopted its Communication Boosting growth and cohesion in EU border regions 6 ('the Border Regions Communication'). It highlights ways in which the EU and its Member States can reduce the complexity, length and costs of cross-border interaction and promote the pooling of services along internal borders. It looks at what needs to be improved to ensure that citizens and businesses in border regions can take full advantage of the opportunities offered on both sides of the border. The Communication proposes a 10 points action plan; one point specifically addresses legal and administrative border obstacles 7 .
It is therefore reasonable to consider that legal barriers (especially those related to health services, labour regulation, taxes, business development), and barriers linked to differences in administrative cultures and national legal frameworks, are difficult for the programmes alone to address (as they required decisions beyond programme and project management structures). A number of effective mechanisms for cross-border cooperation already exist at inter-governmental, regional and local level 8 .
One specific action referred to in point nine of the Border Regions Communication refers to an initiative started under the Luxembourg Presidency in 2015: A number of Member States are considering the merit of a new instrument to simplify cross-border projects by making it possible, on a voluntary basis and agreed by the competent authorities in charge, for the rules of one Member State to apply in the neighbouring Member State. This would apply to a specific project or action limited in time, located within a border region and initiated by local and/or regional public authorities 9 . The Commission hase closely followed this work, agrees with the concept and is therefore proposing a voluntary mechanism to resolve legal obstacles in border regions.
For the details of this proposal see Section 5 below.
• Consistency with existing policy provisions
Interreg as the main funding instrument of Cohesion Policy, supports cross-border cooperation programmes in EU border regions, including those with bordering EFTA countries. However, as set out in the Border Regions Communication, border regions generally perform less well economically than other regions within a Member State. Measures that go beyond European funding but which complement further EU funding in border regions are therefore needed as these ongoing difficulties cannot be addressed through financing and investments such as Interreg alone.
A mechanism to resolve legal obstacles in border regions is therefore a necessary complement both to the financial support under Interreg, but also to institutional support such as European groupings of territorial cooperation 10 , as those groupings are not given legislative powers to overcome legal obstacles 11 .
• Consistency with other Union policies
As set out above, Cohesion Policy and the Single Market support each other. The mechanism to be established under this Regulation would contribute to the objectives of the Border Regions Communication and boosting the potential of border regions, which is partially untapped because of differing legal systems. A recent study contracted by the Commission 12 on the economic impact of border obstacles on GDP and employment levels in internal land border regions estimates that, even if only 20% of the existing obstacles were removed, border regions would increase their GDP by 2%. A mechanism to resolve legal obstacles in border regions is therefore also a necessary complement to the functioning of the internal market, a core objective of the Union (Article 3 TEU and Article 3(1)(b) TFEU) 13 .
The provisions in this proposal on legal protection of persons resident in a cross-border region who consider themselves wronged by acts or omissions arising from the authorities' application of the mechanism predominantly concern administrative/public law and do not affect existing EU law on the resolution of conflict of law 14 , because that EU law concerns civil law only. This Regulation is without prejudice to such law (such EU law may apply to disputes about contractual or non-contractual matters).
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The third subparagraph of Article 175 TFEU provides for specific actions to be decided upon outside the Funds listed in the first subparagraph of that Article, in order to achieve the objective of social and economic cohesion envisaged by the TFEU. The harmonious development of the entire Community territory and greater economic, social and territorial cohesion entail more intensive territorial cooperation. To this end it is appropriate to take the measures to improve implementing conditions for territorial cooperation actions.
• Subsidiarity
The conditions for territorial cooperation should be created in accordance with the subsidiarity principle enshrined in Article 5(3) of the Treaty on the European Union ('TEU'). Member States have undertaken individual, bilateral and even multilateral initiatives to resolve legal border obstacles. However, those mechanisms do not exist in all Member States, or not for all borders of a given Member State. The financing (mainly Interreg) and legal instruments (mainly EGTCs) provided at EU level so far have not been sufficient to resolve legal border obstacles throughout the EU. The objectives of the proposed action can consequently not be sufficiently achieved by the Member States, either at central level or at regional and local level, but can rather, by reason of the scale or effects of the proposed action, be better achieved at Union level. Further action by the Union legislator is therefore needed.
Proportionality
In accordance with the principle of proportionality, as set out in Article 5 i TEU, the content and form of EU action should not exceed what is necessary to achieve the objectives of the Treaties. Recourse to the specific mechanism set up under this Regulation is voluntary. A Member State may decide, on a specific border with one or more neighbouring Member States, to continue to resolve legal obstacles in a specific cross-border region under the effective mechanisms it has set up at national level or which it has set up formally or informally, together with one or more neighbouring Member States. In that case, it may opt not to use the mechanism set up under this Regulation. Likewise, a Member State may decide, on a specific border with one or more neighbouring Member States, to join an existing effective mechanism set up formally or informally by one or more neighbouring Member States. If that mechanism allows it to join, again, it may opt not to use the mechanism set up under this Regulation. This Regulation does therefore not go beyond what is necessary in order to achieve its objectives for those cross-border regions, for which Member States have no efficient mechanisms in place for resolving legal obstacles.
• Choice of the instrument
As set out in Section 1 above, Member States have undertaken individual, bilateral and even multilateral initiatives to resolve legal border obstacles.
A Regulation establishes obligations on Member States to set up, per border with a neighbouring Member State, a mechanism to resolve legal obstacles in a joint cross-border region, while allowing them to implement other effective mechanisms.
A recommendation would not be the most effective instrument, because recommendations do not have binding force (see the fifth paragraph of Article 288 TFEU).
A Directive would also not be the most effective instrument, as it is binding, as to the result to be achieved, upon each Member State to which it is addressed, but leaves the choice of form and methods to the national authorities (see the third paragraph of Article 288 TFEU). As set out in Section 3.2 of the Border Regions Communication, the transposition of an EU Directive in two neighbouring Member States may create two different systems which then meet along internal borders. This may create complexity - and sometimes even legal uncertainty - and inflate costs 15 . This proposal is precisely for a mechanism to establish a method at EU level because only few Member States have set up a different method. A Directive could therefore create new divergences in border regions.
3. RESULTS OF RETROSPECTIVE EVALUATIONS, STAKEHOLDERS CONSULTATIONS AND IMPACT ASSESSMENTS, FUNDAMENTAL RIGHTS
• Retrospective evaluations/fitness checks of existing legislation
Contents
- N/A: new legislation
- N/A: new legislation
- Chapter 1 - General provisions (Articles 1 to 7)
- Chapter 2 - Procedure for concluding a Commitment or Statement (Articles 8 to 17)
- Chapter 3 - Implementation and monitoring of Commitments or Statements (Articles 18 to 20)
- Chapter 4 - Legal protection under Commitment and Statement (Articles 21 and 22)
• Stakeholder consultations
The concept for a cross-border policy stems initially from work undertaken by the Luxembourg Presidency of the Council in 2015, which led to the establishment of an informal working group of Member States that has met regularly since. The informal working group has explored options to facilitate the resolution of persisting border obstacles, especially when implementing cross-border projects. The notion of applying the rules (laws, regulations, standards) of one Member Sate across the border in the neighbouring Member State has been formulated by that group. The group normally gathers between 10 and 15 Member States at its meetings. Groupings of Member States have also been active, in particular the Benelux Union and the Nordic Council of Ministers.
Other stakeholders, in particular border regions and institutions, have been asking for such an instrument for quite some time. This has been particularly visible during the Cross-Border Review undertaken by DG REGIO between 2015 and 2017. During that Review, a public consultation in all the official languages of the EU took place and received over 620 replies. To the question linked to potential solution to border issues, several respondents explicitly asked for the Commission to seek to promote more flexibility in the implementation of national/regional legislation in border regions. The idea of 'freeing' a border region from national legislation or adapting it to border conditions was suggested several times.
Finally, the draft opinions of the Committee of the Regions and of the European Parliament in response to the Communication 'Boosting Growth and Cohesion in EU Border Regions' specifically welcome the proposal to develop such an instrument. Both opinions will be adopted in the summer 2018.
• Impact assessment
The impact and European added value of Interreg programmes are well recognised. However, in many cases cross-border barriers (especially in relation to health services, labour regulation, local public transport and business development) stem from differences in administrative practices and national legal frameworks. These are difficult for programmes to address alone, requiring decisions beyond programme structures.
To tackle this, in 2015 the Luxembourg Presidency and several Member States explored the use of one Member State's rules in a neighbouring Member State. The Commission proposes to facilitate such solutions with an 'off-the-shelf' legal instrument.
There are two options: a European Cross-Border Commitment ("Commitment") (which itself enables derogation from normal rules) or a European Cross-Border Statement ("Statement") (signatories undertake formally to legislate to amend normal rules ). The mechanism will:
• remain voluntary: Member States may opt for the mechanism or use other effective mechanisms to resolve legal border barriers;
• focus on intra-EU land borders, while allowing Member States to also apply the mechanism to maritime and external borders;
• cover joint projects for any item of infrastructure with impact in a cross-border region or any service of general economic interest provided in a cross-border region.
If 20% of existing legal and administrative obstacles found along internal borders were addressed, border regions would increase their GDP by 2%. The Commitment contributes to this by providing a cost-free legal framework to reduce the costs and run-in time of certain cross-border projects.
The framework would help resolve certain expensive complexities when implementing cross-border projects. It is not, however, 'one-size-fits-all' but rather gives Member States the option of devising solutions that best suit the regional context.
• Simplification
• Fundamental rights
Under Article 6 of the Treaty on the European Union, the Union recognises the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union, which has the same legal value as the Treaties. Moreover, fundamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States, constitute general principles of the EU law.
This proposal concerns a legal mechanism to resolve legal border obstacles and is, therefore, mainly addressed to authorities in the Member States. People should benefit from the solutions agreed. Resolving legal border obstacles under this proposal should help people living in border regions to enjoy their fundamental rights. In particular, this refers to the right to protection of personal data (Article 8), to the right to education including access to vocational and continuing training (Article 14), the freedom to choose an occupation and the right to engage in work (Article 15), especially freedom to seek employment, to work, to exercise the right of establishment and to provide services in any Member State; freedom to conduct a business (Article 16); access to social security and social assistance (Article 34); access to health care (Article 35); and access to services of general economic interest (Article 36).
The proposal therefore also covers the issue of effective legal protection of people in border regions.
4. BUDGETARY IMPLICATIONS
The present proposal is not expected to have immediate budgetary implications, in so far as it is to set up a mechanism and not a financial instrument.
The involvement of the Border Focal Point ('BFP') set up within the Commission also has no immediate budgetary implications, in so far as it has already been set up and assigned its own staff.
5. OTHER ELEMENTS
• Implementing plans and monitoring, evaluation and reporting arrangements
Like any EU Regulation the proposed Regulation will be binding in its entirety and directly applicable in all Member States. Article 291 i TFEU requires Member States to adopt all measures of national law necessary to implement legally binding Union acts. As set out in Section 3.2 of the Border Regions Communication, even where there is European legislation , Member States have a degree of flexibility and discretion in the way they apply the legislation in their national systems and in the detailed rules for implementing EU Regulations. As a result, when two different systems meet along internal borders, this may create complexity - and sometimes even legal uncertainty - and inflate costs. Consequently, uniform conditions for implementing legally binding Union acts are needed. As allowed under Article 291(2) TFEU, the proposed Regulation may confer implementing powers on the Commission. Like the method for controlling the implementation of other legal instruments at EU level 16 , this proposal limits itself to requiring Member States to communicate their national implementing rules to the Commission, thus enabling the Commission to assess whether those national rules implement this Regulation effectively.
To assess whether the mechanism established under the proposed Regulation has proven an additional effective tool to resolve legal obstacles in border regions, the Commission should, in line with the Better Regulation Agenda 17 , evaluate existing legislation. It is therefore proposed, as for the EGTC, that the Commission forward a report to the European Parliament, the Council and the Committee of the Regions on the application of the proposed Regulation, using indicators to evaluate its effectiveness, efficiency, relevance, European added value and scope for simplification within 5 years of application of the proposed Regulation.
• Detailed explanation of the specific provisions of the proposal
Title 1 sets out the subject matter and scope of the Regulation, definitions and clarifications, the Member States' choice of whether to use the mechanism established under this proposal, the national and regional Cross-border Coordination Points in the Member States and a coordination point at EU level.
The subject matter (Article 1) is a mechanism to apply, for a common cross-border region, in a given Member State, the legal provisions from the neighbouring Member State if applying its own laws would present a legal obstacle to implementing a joint project (which might be an item of infrastructure or any service of general economic interest).
The Mechanism consists in concluding a European Cross-border Commitment (Commitment'), which is self-executing, or a European Cross-border Statement ('Statement') which requires a further legislative procedure in the Member State.
The scope of the proposed Regulation (Article 2) covers common-border regions on land borders. Based on the evidence gathered under the Cross-border Review and as set out in the Border Regions Communication , legal obstacles are predominantly presented to people interacting on land borders, because people cross borders on a daily or weekly basis for working, learning, shopping or using facilities and services of general economic interest, or a combination of these.
Article 3 lists definitions needed to implement the proposed Regulation together with some clarifications, in particular with regard to Member States which cover several territorial entities with legislative powers, in order to guarantee that all relevant levels of a given Member State can, where relevant, amend legal obstacles under its competence.
To respect the principle of subsidiarity, Member States may opt for the Mechanism established under the proposed Regulation or continue to use other effective mechanisms to resolve legal obstacles, or, for certain borders, join other effective mechanisms (Article 4). Most Member States will probably need to adopt legislation first to enable competent authorities to conclude a Commitment, which by force of its conclusion would allow the Member State to 'pull over the border' legal provisions from the neighbouring Member State thus derogating from its 'normally' applicable national rules. Some Member States may just allow its competent authorities to sign up to a Statement, committing it to legislate to derogate from the 'normally' applicable national rules by means of a formal legislative act. In case of the self-executing Commitment the 'normally' applicable national rules remain, but the Commitment creates a derogation. In case of the Statement, the 'normally' applicable national rules will be formally amended to allow for an explicit derogation.
Member States opting for the Mechanism set up under the proposed Regulation are obliged to establish a national or, in the case of federal states, regional Cross-border Coordination Points (Article 5). Finally, Article 6 lists the tasks of the coordination point at EU level, as announced in the Border Regions Communication and already set up in the Commission's Directorate-General for Regional and Urban Policy. In order to ensure uniform conditions for the implementation of this Regulation, Article 7 confers implementing powers on the Commission in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council 18 for setting up a database and rules for maintaining it, for the protection of data and for the model to be used when information on the implementation and use of the Mechanism is submitted by Cross-border Coordination Points. The database must comply with the provisions on the protection of data under Regulation (EC) No 45/2001 of the European Parliament and of the Council 19 .
The procedure for concluding a Commitment or Statement consists in the preparation and submission of the initiative document (Articles 8 and 9), to be drafted by the 'initiator', a preliminary analysis by the Member State which is requested to 'pull over the border' the legal provisions of the neighbouring Member State (Articles 10 and 11), the drafting of the Commitment or Statement to be concluded (Articles 12 to 15) and finally the conclusion of the Commitment or Statement and its signing by the competent authorities of both Member States (Articles 16 and 17).
More specifically Article 8 establishes who can be an 'initiator': (a) the public or private body responsible for initiating or both initiating and implementing a joint project (e.g. the company organising public transport in Strasbourg planning to extend a tramline over the border to the German town of Kehl); or (b) one or more local or regional authority located in a given cross-border region or exercising public power in that cross-border region (e.g. the city of Strasbourg or the intercommunal structure of Strasbourg Eurométropole or the city of Kehl); or (c) a body with or without legal personality set up for cross-border cooperation located in or covering at least partially a given cross-border region, including European groupings of territorial cooperation under Regulation (EC) No 1082/2006 of the European Parliament and of the Council, Euroregions, Euregios and similar bodies (e.g. the EGTC Eurodistrict Strasbourg-Ortenau); or (d) an organisation set up on behalf of cross-border regions with the aim of promoting the interests of cross-border territories and of facilitating the networking of players and the sharing of experiences, such as the Association of European Border Regions, the Mission Opérationnelle Transfrontalière or the Central European Service for Cross-border Initiatives; or (e) several of the entities referred to in points (a) to (d) jointly.
The initiator shall prepare an initiative document covering the elements listed in Article 9. The derogation from the 'normally' applicable national law is limited to the strict minimum with regard to both the territory it covers and its duration.
The key actors in the Member States requested to conclude a Commitment or Statement are the respective national or regional Cross-border Coordination Points which will liaise with all the competent authorities in the Member State and with their counterpart(s) in the neighbouring Member State (Articles 10 and 11). By a certain deadline, the Cross-border Coordination Point must react and decide whether to launch a procedure leading to the conclusion of a Commitment or Statement, whether the legal obstacle is 'real' and whether for one or more legal obstacles a resolution has been found which could be applied. The initiator may be asked to revise or add to its document (Article 12).
Once the initiative document is considered complete, the Cross-border Coordination Point must prepare a draft Commitment or Statement and, again by a certain deadline, reach an agreement on the text with the other Member State (Articles 13 to 15) and finally conclude it (Articles 16 and 17). The signed Commitment or Statement must set out the elements listed in Article 14 i. The signed Commitment or Statement must be transmitted not only to the initiator, but also to the Cross-border Coordination Point of the neighbouring Member State, the competent authority of its own Member State, the EU coordination point and the authority or body designated by the committing Member State for official publication (Article 17(2)(e)).
The Commitment is implemented by, where relevant, amending existing administrative acts based on the 'normally' applicable law or adopting new administrative acts based on the law 'pulled over the border' (Article 18). Where several authorities are each competent for different aspects of a complex legal obstacle, the Commitment must be accompanied by a timetable for each of them. Respecting the principle of subsidiarity, the adoption and transmission of those amended or new administrative acts must be governed by the national law on administrative procedures (Article 18(5)).
The Statement must be implemented by one or more submissions of proposals to the competent legislative body in order to amend the national law to cover the necessary derogations (Article 19).
In both cases, once all steps planned are implemented, the Cross-border Coordination Point must inform its counterpart in the other Member State and the EU coordination point (Article 18 i and (5) and Article 19(6) and (7)).
Member States may decide that the Cross-border Coordination Point may remind the competent authority to comply with the deadlines and the timetables referred to in Articles 14(3) and 18 i and may inform the authority supervising the competent committing authority or the competent member of government of missed deadlines or timetables fixed in a given Commitment or Statement (Article 6(2)(e)).
Member States should decide which authorities will monitor compliance with a given Commitment and with the amended provisions adopted pursuant to a Statement (Article 20). Based on the adminisitrative acts the respect for the obligations and rights of the addressees thereof should be monitored. Member States should be allowed to decide whether that monitoring is entrusted to the authorities of the Member State which transferred its legal provisions because those authorities are more familiar with those rules or is entrusted to the authorities of the Member State where those provisions are applied because those authorities are more familiar with the remaining legal system of the committing Member States and the law governing the addressees.
Based on experience in negotiating the EGTC Regulation, and in response to specific concerns of some Member States, it is appropriate to address the issue of legal protection of persons resident in a cross-border region who consider themselves wronged by acts or omissions arising from the authorities' application, under a Commitment or Statement, of another Member State' legal provision (Article 21(1)).
Both for Commitments and Statements, the law of the neighbouring Member State is applied in the committing Member State as incorporated into its own legislation and the legal protection should therefore fall to the courts of the committing Member States even where persons have their legal residence in the transferring Member State. The same should apply to legal redress against the Member State whose administrative act is challenged (Article 21(2)). For example, an administrative act allowing a tram to operate on German territory under French law should only be challenged in German courts.
A different approach should apply to legal redress against the monitoring of the application of the Commitment and Statement. Where an authority from the neighbouring Member State (e.g. France) has agreed to monitor the application of the amended law in Germany (by way of integrating French provisions and derogating from 'normally' applicable German provisions) and can act in respect of persons resident in the cross-border area in its own name, the competent courts are those of the Member State where those persons have their legal residence (Article 22(1)). So if a French authority can adopt in its own name an administrative act addressed to the tram operator whose legal residence is in France (stating that the tram operator has not complied with French law on technical requirements for electric signals on German territory), then French courts are competent. However, where the competent transferring authority cannot act in its own name, but only in the name of the competent committing authority, the competent courts are those of the committing Member State, regardless of the legal residence of the person (Article 22(2)). So if the French authority monitors compliance with French law, but the administrative act is in the name of a German authority, then German courts are competent.
Chapter 5 – Implementing and final provisions (Articles 23 to 26)
In order to ensure uniform conditions for the implementation of this Regulation, in particular for the exchange of information between the Cross-border Coordination Points and the Commission through a database set up end maintained by the Commission, implementing powers should be conferred in accordance with the legislation on committee procedure. For practical and coordination purposes, that will be the ‘Coordination Committee for the European Structural and Investment Funds’ (Article 23).
The final provisions 20 establish the Member States' obligation to make the national provisions needed to ensure effective application of the proposed Regulation (Article 24(1)) and to inform the Commission within a year of the entry into force of the proposed Regulation both of those national implementing rules and of the setting up of national or regional Cross-border Coordination Points (Article 24(2)).
As those provisions will specify which border regions of a given Member State are covered by the Mechanism, the Commission will be in a position to assess whether the Member State has opted for a different mechanism for borders not specified. Member States should nevertheless also inform explicitly about such choice under Article 4, but without deadline (Article 24(3)).
Article 25 establishes an obligation of the Commission to forward a report on the application of the proposed Regulation within five years after its adoption.
The application of the Regulation should be deferred by one year after its entry into force in order to grant Member States a year to adopt its national implementation provisions (Article 26).