Athens, Berlin and Vienna will have to explain to the EU Court of Justice the reasons for their continuing failure to transpose the Services Directive (2006/123/EC) and may end up with substantial penalty payments. The European Commission is making use for the first time ever of this provision introduced by Article 260 of the Lisbon Treaty to give member states strong incentive to transpose EU directives.

After sending them reasoned opinions twice, in June 2010 and April 2011, the Commission brought actions before the Luxembourg-based court, on 27 October, because the three states have only partially transposed the 2006 directive, which should have been fully transposed by the end of 2009. Its actions for failure to fulfil obligations also ask the court to order penalty payments against the three in its judgements.

This new measure is meant to shorten procedures, put an end to the infringement more quickly and be very dissuasive. The penalties are daily payments, from the date of the judgement (provided the infringement continues until then) up to the date of full transposition. The Commission has requested daily payments of €141,362.55 for Germany, €44,876.16 for Austria and €51,200.10 for Greece. These amounts take account of the different situations in the three states and of the seriousness of their infringements. Austria still has to adopt horizontal transposition laws; Germany has to adopt three key texts and Greece even more, especially in economically important sectors like tourism, personal services and business services.

Internal Market Commissioner Michel Barnier has warned on different occasions that he would take more stringent measures against member states that drag their feet on removing barriers that prevent consumers and businesses from taking full advantage of the single market for services, the main source of growth and new jobs in the EU. The European Parliament, with its adoption last February of a report by Evelyne Gebhardt (S&D, Germany), encouraged him to make sanctions tougher (see Europolitics 4142).

Background

Article 260.3 of the Lisbon Treaty introduces a procedure to speed up the transposition process by penalising states at an earlier stage. As soon as an action for failure to fulfil obligations has been brought on the basis of Article 258 TFEU, the Commission can ask the court, if it rules that an infringement has been committed, to impose in the same judgement a flat-rate penalty or daily penalty payment, within the limit of the amount set by the executive. The Commission explains in a communication of 15 January 2011 how such payments are calculated.