                  27.12.2017

                  EN

                  Official Journal of the European Union

                  L 345/96

            DIRECTIVE (EU) 2017/2399 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
      of 12 December 2017
      amending Directive 2014/59/EU as regards the ranking of unsecured debt instruments in insolvency hierarchy
      THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
      Having regard to the Treaty on the Functioning of the European Union, and in particular Article 114 thereof,
      Having regard to the proposal from the European Commission,
      After transmission of the draft legislative act to the national parliaments,
      Having regard to the opinion of the European Central Bank (1),
      Having regard to the opinion of the European Economic and Social Committee (2),
      Acting in accordance with the ordinary legislative procedure (3),
      Whereas:

                  (1)

                  On 9 November 2015, the Financial Stability Board (FSB) published the Total Loss-absorbing Capacity (TLAC) Term Sheet (‘the TLAC standard’),which was endorsed by the G20 in November 2015. The objective of the TLAC standard is to ensure that global systemically important banks (G-SIBs), referred to in the Union framework as global systemically important institutions (G-SIIs), have the loss-absorbing and recapitalisation capacity necessary to help ensure that, in and immediately following a resolution, critical functions can be continued without taxpayers’ funds (public funds) or financial stability being put at risk. In its communication of 24 November 2015 entitled ‘Towards the completion of the Banking Union’, the Commission committed itself to bringing forward, by the end of 2016, a legislative proposal that would enable the TLAC standard to be implemented into Union law by the internationally agreed deadline of 2019.

                  (2)

                  The implementation of the TLAC standard into Union law needs to take into account the existing institution-specific minimum requirement for own funds and eligible liabilities (MREL) applicable to all Union institutions as laid down in Directive 2014/59/EU of the European Parliament and of the Council (4). As TLAC and MREL pursue the same objective of ensuring that Union institutions have sufficient loss-absorbing and recapitalisation capacity, the two requirements should be complementary elements of a common framework. Concretely, the Commission proposed that the harmonised minimum level of the TLAC standard for G-SIIs (‘the TLAC minimum requirement’) and the eligibility criteria for liabilities used to comply with that standard should be introduced in Union law through amendments to Regulation (EU) No 575/2013 of the European Parliament and of the Council (5), while the institution-specific add-on for G-SIIs and the institution-specific requirement for non-G-SIIs as well as relevant eligibility criteria should be addressed through targeted amendments to Directive 2014/59/EU and to Regulation (EU) No 806/2014 of the European Parliament and of the Council (6).
                  This Directive, which concerns the ranking of unsecured debt instruments in insolvency hierarchy, is complementary to the aforementioned legislative acts, as proposed to be amended, and to Directive 2013/36/EU of the European Parliament and of the Council (7).

                  (3)

                  In view of those proposals and in order to ensure legal certainty for markets and for entities subject to MREL and TLAC, it is important to ensure timely clarity about the eligibility criteria of liabilities used for compliance with MREL and with Union law implementing TLAC, and to introduce appropriate grandfathering provisions for the eligibility of liabilities issued before the revised eligibility criteria come into effect.

                  (4)

                  Member States should ensure that institutions have sufficient loss-absorbing and recapitalisation capacity to ensure smooth and fast absorption of losses and recapitalisation with a minimum impact on financial stability and while aiming to avoid an impact on taxpayers. That should be achieved through constant compliance by institutions with the TLAC minimum requirement, which is to be implemented in Union law through an amendment of Regulation (EU) No 575/2013, and with a requirement for own funds and eligible liabilities as provided for in Directive 2014/59/EU.

                  (5)

                  The TLAC standard requires G-SIIs to meet the TLAC minimum requirement, with certain exceptions, with subordinated liabilities that rank in insolvency below liabilities excluded from TLAC (‘subordination requirement’). Under the TLAC standard, subordination is to be achieved through the legal effects of a contract (known as contractual subordination), the laws of a given jurisdiction (known as statutory subordination) or a given corporate structure (known as structural subordination). Where required by Directive 2014/59/EU, institutions falling within the scope of that Directive should meet their firm-specific requirement with subordinated liabilities so as to minimise the risk of legal challenge by creditors, on the basis that the creditors’ losses in resolution are greater than the losses that they would have incurred under normal insolvency proceedings (the no-creditor-worse-off principle).

                  (6)

                  A number of Member States have amended or are in the process of amending the rules on insolvency ranking of unsecured senior debt under their national insolvency law to allow their institutions to comply with the subordination requirement in a more efficient manner, thereby facilitating resolution.

                  (7)

                  The national rules adopted so far diverge significantly. The absence of harmonised Union rules creates uncertainty for issuing institutions and investors alike and is likely to make the application of the bail-in tool for cross-border institutions more difficult. The absence of harmonised Union rules is also likely to result in competitive distortions on the internal market, given that the costs for institutions to comply with the subordination requirement and the costs borne by investors when buying debt instruments issued by institutions could differ considerably across the Union.

                  (8)

                  In its resolution of 10 March 2016 on the Banking Union (8), the European Parliament called on the Commission to present proposals to reduce further the legal risks of claims under the no creditor worse off principle, and, in its conclusions of 17 June 2016, the Council invited the Commission to put forward a proposal on a common approach to the bank creditors’ hierarchy to enhance legal certainty in the event of resolution.

                  (9)

                  It is, therefore, necessary to remove the significant obstacles in the functioning of the internal market and avoid distortions of competition resulting from the absence of harmonised Union rules on bank creditors’ hierarchy and to prevent such obstacles and distortions from arising in the future. Consequently, the appropriate legal basis for this Directive is Article 114 of the Treaty on the Functioning of the European Union.

                  (10)

                  In order to reduce to a minimum the costs of compliance with the subordination requirement and any negative impact on funding costs, this Directive should allow Member States to keep, where applicable, the existing class of ordinary unsecured senior debt, which is less costly for institutions to issue than any other subordinated liabilities. In order to enhance the resolvability of institutions, this Directive should, nevertheless, require Member States to create a new class of non-preferred senior debt that should rank in insolvency above own funds instruments and subordinated liabilities that do not qualify as own funds instruments, but below other senior liabilities. Institutions should remain free to issue debt in both the senior and the non-preferred senior classes. Of those two classes, and without prejudice to other options and exemptions provided for in the TLAC standard to comply with the subordination requirement, only the non-preferred senior class should be eligible to meet the subordination requirement. That is intended to enable institutions to use the less costly ordinary senior debt for their funding or any other operational reasons and to issue debt in the new non-preferred senior class to obtain funding while complying with the subordination requirement. Member States should be allowed to create several classes for other ordinary unsecured liabilities provided that they ensure, without prejudice to other options and exemptions provided for in the TLAC standard, that only the non-preferred senior class of debt instruments is eligible to meet the subordination requirement.

                  (11)

                  To ensure that the new non-preferred senior class of debt instruments meets the eligibility criteria as described in the TLAC standard and as set out in Directive 2014/59/EU, thereby enhancing legal certainty, Member States should ensure that those debt instruments have an original contractual maturity of at least one year, do not contain embedded derivatives and are not derivatives themselves, and that the relevant contractual documentation related to their issuance and, where applicable, the prospectus explicitly refer to their lower ranking under normal insolvency proceedings. Debt instruments with variable interest derived from a broadly used reference rate, such as Euribor or Libor, and debt instruments not denominated in the domestic currency of the issuer, provided that principal, repayment and interest are denominated in the same currency, should not be considered to be debt instruments containing embedded derivatives solely because of those features. This Directive should be without prejudice to any requirement in national law to register debt instruments in the issuer’s company registry for liabilities to meet the conditions for non-preferred senior class of debt instruments provided for in this Directive.

                  (12)

                  To enhance legal certainty for investors, Member States should ensure that ordinary unsecured debt instruments and other ordinary unsecured liabilities that are not debt instruments have a higher priority ranking in their national insolvency laws than the new non-preferred senior class of debt instruments. Member States should also ensure that the new non-preferred senior class of debt instruments has a higher priority ranking than the priority ranking of own funds instruments and the priority ranking of any subordinated liabilities that do not qualify as own funds.

                  (13)

                  Since the objectives of this Directive, namely to lay down harmonised rules for the insolvency ranking of unsecured debt instruments for the purposes of the Union recovery and resolution framework and, in particular, to improve the effectiveness of the bail-in regime, cannot be sufficiently achieved by the Member States but can rather, by reason of the scale of the action, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives. In particular, this Directive should be without prejudice to other options and exemptions provided for in the TLAC standard to comply with the subordination requirement.

                  (14)

                  It is appropriate for the amendments to Directive 2014/59/EU provided for in this Directive to apply to unsecured claims resulting from debt instruments issued on or after the date of application of this Directive. However, for the purposes of legal certainty and to mitigate transitional costs as much as possible, it is necessary to introduce appropriate safeguards as regards the insolvency ranking of claims resulting from debt instruments issued before that date. Member States should therefore ensure that the insolvency ranking of all outstanding unsecured claims resulting from debt instruments that institutions have issued before that date is governed by the laws of the Member States as adopted at 31 December 2016. To the extent that certain national laws as adopted at 31 December 2016 already address the objective of allowing institutions to issue subordinated liabilities, part or all of the outstanding unsecured claims resulting from debt instruments issued prior to the date of application of this Directive should be able to have the same insolvency ranking as the non-preferred senior debt instruments issued under the conditions of this Directive. In addition, after 31 December 2016 and before the date of entry into force of this Directive, Member States should be able to adapt their national laws governing the ranking in normal insolvency proceedings of unsecured claims resulting from debt instruments issued after the date of application of such laws in order to comply with the conditions laid down in this Directive. In that case, only the unsecured claims resulting from the debt instruments issued before the application of that new national law should continue to be governed by the laws of the Member States as adopted at 31 December 2016.

                  (15)

                  This Directive should not prevent Member States from providing that this Directive should continue to apply when the issuing entities are no longer subject to the Union recovery and resolution framework because of, in particular, the divestment of their credit or investment activities to a third party.

                  (16)

                  This Directive harmonises the ranking under normal insolvency proceedings of unsecured claims resulting from debt instruments and does not cover the insolvency ranking of deposits beyond the existing applicable provisions of Directive 2014/59/EU. This Directive is therefore without prejudice to any existing or future national laws of Member States governing normal insolvency proceedings that cover the insolvency ranking of deposits, to the extent that such ranking is not harmonised by Directive 2014/59/EU, irrespective of the date on which the deposits were made. By 29 December 2020, the Commission should review the application of Directive 2014/59/EU with regard to the ranking of deposits in insolvency and assess in particular the need for any further amendments thereto.

                  (17)

                  To ensure legal certainty for markets and individual institutions and to facilitate the effective application of the bail-in tool, this Directive should enter into force on the day following that of its publication,

            HAVE ADOPTED THIS DIRECTIVE:
      Article 1
      Amendments to Directive 2014/59/EU
      Directive 2014/59/EU is amended as follows:

                  (1)

                  in Article 2(1), point (48) is replaced by the following:

                              ‘(48)

                              “debt instruments”:

                                          (i)

                                          for the purpose of points (g) and (j) of Article 63(1), means bonds and other forms of transferrable debt, instruments creating or acknowledging a debt, and instruments giving rights to acquire debt instruments; and

                                          (ii)

                                          for the purpose of Article 108, means bonds and other forms of transferrable debt and instruments creating or acknowledging a debt;’;

                  (2)

                  Article 108 is replaced by the following:
                  ‘Article 108
                  Ranking in insolvency hierarchy
                  1.   Member States shall ensure that in their national laws governing normal insolvency proceedings:

                              (a)

                              the following have the same priority ranking which is higher than the ranking provided for the claims of ordinary unsecured creditors:

                                          (i)

                                          that part of eligible deposits from natural persons and micro, small and medium-sized enterprises which exceeds the coverage level provided for in Article 6 of Directive 2014/49/EU;

                                          (ii)

                                          deposits that would be eligible deposits from natural persons and micro, small and medium-sized enterprises were they not made through branches located outside the Union of institutions established within the Union;

                              (b)

                              the following have the same priority ranking which is higher than the ranking provided for under point (a):

                                          (i)

                                          covered deposits;

                                          (ii)

                                          deposit guarantee schemes subrogating to the rights and obligations of covered depositors in insolvency.

                        2.   Member States shall ensure that, for entities referred to in points (a) to (d) of the first subparagraph of Article 1(1), ordinary unsecured claims have, in their national laws governing normal insolvency proceedings, a higher priority ranking than that of unsecured claims resulting from debt instruments that meet the following conditions:

                              (a)

                              the original contractual maturity of the debt instruments is of at least one year;

                              (b)

                              the debt instruments contain no embedded derivatives and are not derivatives themselves;

                              (c)

                              the relevant contractual documentation and, where applicable, the prospectus related to the issuance explicitly refer to the lower ranking under this paragraph.

                        3.   Member States shall ensure that unsecured claims resulting from debt instruments that meet the conditions laid down in points (a), (b) and (c) of paragraph 2 of this Article have a higher priority ranking in their national laws governing normal insolvency proceedings than the priority ranking of claims resulting from instruments referred to in points (a) to (d) of Article 48(1).
                  4.   Without prejudice to paragraphs 5 and 7, Member States shall ensure that their national laws governing normal insolvency proceedings as they were adopted at 31 December 2016 apply to the ranking in normal insolvency proceedings of unsecured claims resulting from debt instruments issued by entities referred to in points (a) to (d) of the first subparagraph of Article 1(1) of this Directive prior to the date of entry into force of measures under national law transposing Directive (EU) 2017/2399 of the European Parliament and of the Council (*1).
                  5.   Where, after 31 December 2016 and before 28 December 2017, a Member State adopted a national law governing the ranking in normal insolvency proceedings of unsecured claims resulting from debt instruments issued after the date of application of such national law, paragraph 4 of this Article shall not apply to claims resulting from debt instruments issued after the date of application of that national law, provided that all of the following conditions are met:

                              (a)

                              under that national law, and for entities referred to in points (a) to (d) of the first subparagraph of Article 1(1), ordinary unsecured claims have, in normal insolvency proceedings, a higher priority ranking than that of unsecured claims resulting from debt instruments that meet the following conditions:

                                          (i)

                                          the original contractual maturity of the debt instruments is of at least one year;

                                          (ii)

                                          the debt instruments contain no embedded derivatives and are not derivatives themselves; and

                                          (iii)

                                          the relevant contractual documentation and, where applicable, the prospectus related to the issuance explicitly refer to the lower ranking under the national law;

                              (b)

                              under that national law, unsecured claims resulting from debt instruments that meet the conditions laid down in point (a) of this subparagraph have, in normal insolvency proceedings, a higher priority ranking than the priority ranking of claims resulting from instruments referred to in points (a) to (d) of Article 48(1).

                        On the date of entry into force of measures under national law transposing Directive (EU) 2017/2399, the unsecured claims resulting from debt instruments referred to in point (b) of the first subparagraph shall have the same priority ranking as the one referred to in points (a), (b) and (c) of paragraph 2 and in paragraph 3 of this Article.
                  6.   For the purposes of point (b) of paragraph 2 and point (a)(ii) of the first subparagraph of paragraph 5, debt instruments with variable interest derived from a broadly used reference rate and debt instruments not denominated in the domestic currency of the issuer, provided that principal, repayment and interest are denominated in the same currency, shall not be considered to be debt instruments containing embedded derivatives solely because of those features.
                  7.   Member States that, prior to 31 December 2016, adopted a national law governing normal insolvency proceedings whereby ordinary unsecured claims resulting from debt instruments issued by entities referred to in points (a) to (d) of the first subparagraph of Article 1(1) are split into two or more different priority rankings, or whereby the priority ranking of ordinary unsecured claims resulting from such debt instruments is changed in relation to all other ordinary unsecured claims of the same ranking, may provide that debt instruments with the lowest priority ranking among those ordinary unsecured claims have the same ranking as that of claims that meet the conditions of points (a), (b) and (c) of paragraph 2 and of paragraph 3 of this Article.

                     (*1)  Directive (EU) 2017/2399 of the European Parliament and of the Council of 12 December 2017 amending Directive 2014/59/EU as regards the ranking of unsecured debt instruments in insolvency hierarchy (OJ L 345, 27.12.2017, p. 96).’."

            Article 2
      Transposition
      1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 29 December 2018. They shall immediately inform the Commission thereof.
      Member States shall apply those measures as from the date of their entry into force in national law.
      2.   When Member States adopt the measures referred to in paragraph 1, they shall contain a reference to this Directive or shall be accompanied by such a reference on the occasion of their official publication. The methods of making such a reference shall be laid down by Member States.
      3.   Paragraph 2 shall not apply where the national measures of Member States in force before the date of entry into force of this Directive comply with this Directive. In such cases, Member States shall notify the Commission accordingly.
      4.   Member States shall communicate to the Commission and to the European Banking Authority the text of the main measures of national law which they adopt in the field covered by this Directive.
      Article 3
      Review
      By 29 December 2020, the Commission shall review the application of Article 108(1) of Directive 2014/59/EU. The Commission shall assess in particular the need for any further amendments with regard to the ranking of deposits in insolvency. The Commission shall submit a report thereon to the European Parliament and to the Council.
      Article 4
      Entry into force
      This Directive shall enter into force on the day following that of its publication in the Official Journal of the European Union.
      Article 5
      Addressees
      This Directive is addressed to the Member States.

         Done at Strasbourg, 12 December 2017.

               For the European Parliament

               The President

            A. TAJANI

               For the Council

               The President

            M. MAASIKAS

         (1)  OJ C 132, 26.4.2017, p. 1.

         (2)  OJ C 173, 31.5.2017, p. 41.

         (3)  Position of the European Parliament of 30 November 2017 (not yet published in the Official Journal) and decision of the Council of 7 December 2017.

         (4)  Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ L 173, 12.6.2014, p. 190).

         (5)  Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1).

         (6)  Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ L 225, 30.7.2014, p. 1).

         (7)  Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 27.6.2013, p. 338).

         (8)  Not yet published in the Official Journal.


title: Commission Directive (EU) 2018/217 of 31 January 2018 amending Directive 2008/68/EC of the European Parliament and of the Council on the inland transport of dangerous goods by adapting Section I.1 of its Annex I to scientific and technical progress

text:
               15.2.2018

               EN

               Official Journal of the European Union

               L 42/52

         COMMISSION DIRECTIVE (EU) 2018/217
   of 31 January 2018
   amending Directive 2008/68/EC of the European Parliament and of the Council on the inland transport of dangerous goods by adapting Section I.1 of its Annex I to scientific and technical progress
   THE EUROPEAN COMMISSION,
   Having regard to the Treaty on the Functioning of the European Union,
   Having regard to Directive 2008/68/EC of the European Parliament and of the Council of 24 September 2008 on inland transport of dangerous goods (1), and in particular Article 8(1) thereof,
   Whereas:

               (1)

               Section I.1 of Annex I to Directive 2008/68/EC refers to provisions set out in the international agreement on the road transport of dangerous goods as defined in Article 2 of that Directive.

               (2)

               The provisions of that international agreement are to be updated regularly in accordance with Article 14 of the European Agreement concerning the International Carriage of Dangerous Goods by Road (ADR). The last amended version of the international agreement is to apply as from 3 January 2018.

               (3)

               Section I.1 of Annex I to Directive 2008/68/EC should therefore be amended accordingly.

               (4)

               The measures provided for in this Directive are in accordance with the opinion of the Committee on the transport of dangerous goods,

         HAS ADOPTED THIS DIRECTIVE:
   Article 1
   In Annex I to Directive 2008/68/EC, Section I.1 is replaced by the following:

      ‘I.1   ADR
      Annexes A and B to the ADR, as applicable with effect from 3 January 2018, it being understood that “contracting party” is replaced by “Member State” as appropriate.’.

   Article 2
   1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 3 July 2018 at the latest. They shall forthwith communicate to the Commission the text of those provisions.
   When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made.
   2.   Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.
   Article 3
   This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
   Article 4
   This Directive is addressed to the Member States.

      Done at Brussels, 31 January 2018.

            For the Commission

            The President

         Jean-Claude JUNCKER

      (1)  OJ L 260, 30.9.2008, p. 13.


title: Council Directive (EU) 2018/912 of 22 June 2018 amending Directive 2006/112/EC on the common system of value added tax as regards the obligation to respect a minimum standard rate

text:
               27.6.2018

               EN

               Official Journal of the European Union

               L 162/1

         COUNCIL DIRECTIVE (EU) 2018/912
   of 22 June 2018
   amending Directive 2006/112/EC on the common system of value added tax as regards the obligation to respect a minimum standard rate
   THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Article 113 thereof,
   Having regard to the proposal from the European Commission,
   After transmission of the draft legislative act to the national parliaments,
   Having regard to the opinion of the European Parliament (1),
   Having regard to the opinion of the European Economic and Social Committee (2),
   Acting in accordance with a special legislative procedure,
   Whereas:

               (1)

               Article 97 of Council Directive 2006/112/EC (3) provides that, from 1 January 2016 until 31 December 2017, the standard rate may not be lower than 15 %.

               (2)

               The application of a standard rate of value added tax (VAT) ensures the smooth functioning of the common system of VAT and should therefore be kept in place.

               (3)

               It is appropriate to maintain the current minimum standard rate at 15 %, and to make it permanent.

               (4)

               Since the objective of this Directive, namely to set a minimum standard rate of VAT, cannot be sufficiently achieved by the Member States, but can rather, by reason of the scale or effects of the action, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective.

               (5)

               Directive 2006/112/EC should therefore be amended accordingly,

         HAS ADOPTED THIS DIRECTIVE:
   Article 1
   Article 97 of Directive 2006/112/EC is replaced by the following:

      ‘Article 97
      The standard rate shall not be lower than 15 %.’.

   Article 2
   1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 1 September 2018 at the latest. They shall immediately communicate the text of those measures to the Commission.
   When Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such a reference is to be made.
   2.   Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.
   Article 3
   This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
   Article 4
   This Directive is addressed to the Member States.

      Done at Luxembourg, 22 June 2018.

            For the Council

            The President

         V. GORANOV

      (1)  Opinion of the European Parliament of 19 April 2018 (not yet published in the Official Journal).

      (2)  Opinion of the European Economic and Social Committee of 23 May 2018 (not yet published in the Official Journal).

      (3)  Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ L 347, 11.12.2006, p. 1).


title: Directive (EU) 2018/958 of the European Parliament and of the Council of 28 June 2018 on a proportionality test before adoption of new regulation of professions

text:
               9.7.2018

               EN

               Official Journal of the European Union

               L 173/25

         DIRECTIVE (EU) 2018/958 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
   of 28 June 2018
   on a proportionality test before adoption of new regulation of professions
   THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Article 46, Article 53(1) and Article 62 thereof,
   Having regard to the proposal from the European Commission,
   After transmission of the draft legislative act to the national parliaments,
   Having regard to the opinion of the European Economic and Social Committee (1),
   After consulting the Committee of the Regions,
   Acting in accordance with the ordinary legislative procedure (2),
   Whereas:

               (1)

               The freedom to choose an occupation is a fundamental right. The Charter of Fundamental Rights of the European Union (‘the Charter’) guarantees the freedom to choose an occupation, as well as the freedom to conduct a business. The free movement of workers, the freedom of establishment and the freedom to provide services are fundamental principles of the internal market enshrined in the Treaty on the Functioning of the European Union (TFEU). National rules organising access to regulated professions should therefore not constitute an unjustified or disproportionate obstacle to the exercise of those fundamental rights.

               (2)

               In the absence of specific provisions harmonising the requirements on access to a regulated profession or the pursuit thereof laid down in Union law, it is a Member State competence to decide whether and how to regulate a profession within the limits of the principles of non-discrimination and proportionality.

               (3)

               The principle of proportionality is one of the general principles of Union law. It follows from case-law (3) that national measures liable to hinder, or to make less attractive, the exercise of fundamental freedoms guaranteed by the TFEU should fulfil four conditions, namely, they should: be applied in a non-discriminatory manner; be justified by public interest objectives; be suitable for securing the attainment of the objective which they pursue; and not go beyond what is necessary in order to attain that objective.

               (4)

               Directive 2005/36/EC of the European Parliament and of the Council (4) includes an obligation for Member States to assess the proportionality of their requirements restricting access to, or the pursuit of, regulated professions, and to communicate the results of that assessment to the Commission, launching the ‘mutual evaluation process’. That process means that Member States had to carry out a screening of all their legislation on all of the professions that were regulated in their territory.

               (5)

               The results of the mutual evaluation process revealed a lack of clarity as regards the criteria to be used by Member States when assessing the proportionality of requirements restricting access to, or the pursuit of, regulated professions, as well as an uneven scrutiny of such requirements at all levels of regulation. To avoid fragmentation of the internal market and to eliminate barriers to the taking-up and pursuit of certain employed or self-employed activities, there should be a common approach at Union level, preventing disproportionate measures from being adopted.

               (6)

               In its Communication of 28 October 2015 entitled ‘Upgrading the Single market: more opportunities for people and businesses’, the Commission identified the need to adopt an analytical proportionality framework for Member States to use when reviewing existing regulations of professions or when proposing new ones.

               (7)

               This Directive aims to establish rules for proportionality assessments to be conducted by Member States before the introduction of new, or the amendment of existing, professional regulations, in order to ensure the proper functioning of the internal market, while guaranteeing transparency and a high level of consumer protection.

               (8)

               The activities covered by this Directive should concern the regulated professions falling within the scope of Directive 2005/36/EC. This Directive should apply to requirements restricting access to, or the pursuit of, existing regulated professions or new professions that Member States are considering whether to regulate. This Directive should apply in addition to Directive 2005/36/EC and without prejudice to other provisions laid down in a separate Union act concerning access to, or the pursuit of, a given regulated profession.

               (9)

               This Directive is without prejudice to the competence of Member States to define the organisation and the content of their systems of education and professional training, and in particular as regards the possibility for them to delegate to professional organisations the power to organise or supervise professional education and training. Provisions which do not restrict access to, or the pursuit of, regulated professions, including editorial amendments, technical adaptations to the content of training courses or the modernisation of training regulations, should not fall within the scope of this Directive. Where professional education or training consists of activities which are remunerated, the freedom of establishment and the freedom to provide services should be guaranteed.

               (10)

               Where Member States transpose specific requirements concerning the regulation of a given profession established in a separate Union act which does not leave Member States a choice as to the exact way in which they are to be transposed, the assessment of proportionality, as required by specific provisions of this Directive, should not be applied.

               (11)

               Member States should be able to rely on a common regulatory framework based on clearly defined legal concepts concerning the different ways to regulate a profession across the Union. There are several ways to regulate a profession, for instance by reserving access to, or the pursuit of, a particular activity to holders of a professional qualification. Member States may also regulate one of the modes of pursuit of a profession by laying down conditions for the use of professional titles or by imposing qualification requirements only on self-employed, on salaried professionals, or on the managers or legal representatives of undertakings, especially where the activity is pursued by a legal person in the form of a professional company.

               (12)

               Before introducing new, or amending existing, legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions, Member States should assess the proportionality of such provisions. The extent of the assessment should be proportionate to the nature, the content and the impact of the provision being introduced.

               (13)

               The burden of proof of justification and proportionality lies with the Member States. The reasons for regulating invoked by a Member State by way of justification should thus be accompanied by an analysis of the appropriateness and proportionality of the measure adopted by that Member State and by specific evidence substantiating its arguments. Although a Member State does not necessarily have to produce a specific study or a specific form of evidence or materials establishing the proportionality of such a measure prior to its adoption, it should carry out an objective analysis, taking into account the specific circumstances of that Member State, that demonstrates that there are genuine risks for the achievement of public interest objectives.

               (14)

               Member States should carry out proportionality assessments in an objective and independent manner, including where a profession is regulated indirectly by giving a particular professional body the power to regulate. Those assessments could include an opinion obtained from an independent body, including existing bodies that are part of the national legislative process, entrusted by the Member States concerned with the task of providing such opinion. This is particularly important in cases where the assessment is made by local authorities, regulatory bodies or professional organisations, whose greater proximity to local conditions and specialised knowledge could in certain cases make them better placed to identify the best way of meeting the public interest objectives, but whose policy choices could provide benefits to established operators at the expense of new market entrants.

               (15)

               It is appropriate to monitor the proportionality of new or amended provisions restricting access to, or the pursuit of, regulated professions after their adoption. A review of the proportionality of a restrictive national measure in the area of regulated professions should be based not only on the objective of that national measure at the time of its adoption, but also on its effects, assessed after its adoption. The assessment of the proportionality of the national measure should be based on developments found to have occurred in the area of the regulated profession since the measure was adopted.

               (16)

               As confirmed by settled case-law, any unjustified restriction resulting from national law restricting the freedom of establishment or the freedom to provide services is prohibited, including any discrimination on grounds of nationality or residence.

               (17)

               Where the taking-up and the pursuit of employed or self-employed activities are conditional on complying with certain requirements relating to specific professional qualifications, laid down directly or indirectly by the Member States, it is necessary to ensure that such requirements are justified by public interest objectives, such as those within the meaning of the TFEU, namely public policy, public security and public health, or by overriding reasons in the public interest, recognised as such in the case-law of the Court of Justice. It is also necessary to clarify that the following are among the overriding reasons in the public interest, recognised by the Court of Justice: preserving the financial equilibrium of the social security system; the protection of consumers, of recipients of services, including by guaranteeing the quality of craft work, and of workers; the safeguarding of the proper administration of justice; ensuring the fairness of trade transactions; the combating of fraud and the prevention of tax evasion and avoidance, and the safeguarding of the effectiveness of fiscal supervision; transport safety; the protection of the environment and the urban environment; the health of animals; intellectual property; the safeguarding and conservation of the national historic and artistic heritage; social policy objectives; and cultural policy objectives. According to settled case-law, purely economic reasons, namely promoting the national economy to the detriment of the fundamental freedoms, as well as purely administrative reasons, such as carrying out controls or gathering statistics, cannot constitute an overriding reason in the public interest.

               (18)

               It is for the Member States to determine the level of protection which they wish to afford to the public interest objectives and the appropriate level of regulation, within the limits of proportionality. The fact that one Member State imposes less strict rules than another Member State does not mean that the latter Member State’s rules are disproportionate and therefore incompatible with Union law.

               (19)

               With regard to the protection of public health, according to Article 168(1) TFEU, a high level of human health protection is to be ensured in the definition and implementation of all Union policies and activities. This Directive is fully in line with that objective.

               (20)

               In order to ensure that the provisions they introduce, and that amendments they make to existing provisions, are proportionate, Member States should consider the criteria for assessing the proportionality and the additional criteria which are relevant for the regulated profession being analysed. Where a Member State intends to regulate a profession or to amend existing rules, account should be taken of the nature of the risks related to the public interest objectives pursued, in particular the risks to service recipients, including consumers, to professionals or to third parties. It should also be borne in mind that, in the field of professional services, there is usually an asymmetry of information between consumers and professionals, given that professionals display a high level of technical knowledge which consumers may not have.

               (21)

               Requirements linked to professional qualifications should be considered to be necessary only where existing measures, such as product safety law or consumer protection law, cannot be regarded as being suitable or genuinely effective to achieve the aim pursued.

               (22)

               To meet the requirement of proportionality, a measure should be suitable for securing the attainment of the objective pursued. A measure should be considered to be suitable for securing the attainment of the objective pursued only if it genuinely reflects a concern to attain that objective in a consistent and systematic manner, for instance where similar risks related to certain activities are addressed in a comparable way and where any exceptions to the restrictions involved are applied in line with the stated objective. Furthermore, the national measure should effectively contribute to achieving the objective pursued and therefore, where it has no effect on the ground for justification, it should not be considered to be suitable.

               (23)

               The overall impact of the measure on the free movement of persons and services within the Union, on consumer choice and on the quality of the service provided should be duly taken into account by the Member States. On that basis, Member States should ascertain, in particular, whether the extent of the restriction to access to, or the pursuit of, regulated professions is proportionate to the importance of the objectives pursued and the expected gains.

               (24)

               Member States should carry out a comparison between the national measure at issue and alternative, less restrictive means that would result in the same objective being attained but would impose fewer restrictions. Where the measures are justified by consumer protection only and where the risks identified are limited to the relationship between the professional and the consumer and therefore do not negatively affect third parties, Member States should assess whether their objective could be attained by means that are less restrictive than reserving activities to professionals. For instance, where consumers can reasonably make a choice between using the services of qualified professionals or not, less restrictive means, such as protection of the professional title or enrolment on a professional register, should be used. Regulation by way of reserved activities and protected professional title should be considered where the measures aim to prevent a risk of serious harm to public interest objectives, such as public health.

               (25)

               Where relevant in view of the nature and the content of the measure being analysed, Member States should also take the following elements into account: the connection between the scope of professional activities covered by a profession and the professional qualification required; the complexity of the tasks in particular as regards the level, the nature and the duration of the training or experience required; the existence of different routes to obtain the professional qualification; whether the activities reserved to certain professionals can be shared with other professionals; and the degree of autonomy in exercising a regulated profession in particular where the activities relating to a regulated profession are pursued under the control and responsibility of a duly qualified professional.

               (26)

               This Directive takes account of scientific and technological progress, and contributes to the proper functioning of the internal market, including in the digital environment. In view of the speed of technological change and scientific developments, updates in access requirements could be of particular importance for a number of professions, especially for professional services provided by electronic means. Where a Member State regulates a profession, account should be taken of the fact that scientific and technological developments could reduce or increase the asymmetry of information between professionals and consumers. Where the scientific and technological developments carry a high risk to the public interest objectives, it is for the Member States, where necessary, to encourage professionals to keep up with those developments.

               (27)

               Member States should carry out a comprehensive assessment of the circumstances in which the measure is adopted and implemented and examine in particular the effect of the new or amended provisions when combined with other requirements restricting access to, or the pursuit of, the profession. The taking-up and pursuit of certain activities may be conditional on complying with several requirements such as rules relating to the organisation of the profession, compulsory membership of a professional organisation or body, professional ethics, supervision and liability. Therefore, when assessing the effect of the new or amended provisions, Member States should take into account the existing requirements, including continuous professional development, compulsory membership of a professional organisation or body, registration or authorisation schemes, quantitative restrictions, specific legal form requirements and shareholding requirements, territorial restrictions, multidisciplinary restrictions and incompatibility rules, requirements concerning insurance cover, language knowledge requirements, to the extent necessary to practise the profession, fixed minimum and/or maximum tariff requirements, and requirements on advertising.

               (28)

               The introduction of additional requirements may be suitable to attain the public interest objectives. The mere fact that their individual or combined effect should be assessed does not mean that those requirements are prima facie disproportionate. For example, the obligation to undergo continuous professional development may be suitable to ensure that professionals keep abreast of developments in their respective areas, as long as it does not lay down discriminatory and disproportionate conditions to the detriment of new entrants. Likewise, compulsory membership of a professional organisation or body may be considered appropriate where those professional organisations or bodies are entrusted by the State with safeguarding the relevant public interest objectives, for example in supervising the legitimate practice of the profession, or organising or supervising continuous professional training. Where the independence of a profession cannot be adequately guaranteed by other means, Member States could consider the application of safeguards, such as limiting the shareholding of persons outside the profession or providing that the majority of the voting rights are to be held by persons practising the profession, as long as such safeguards do not go beyond what is necessary in order to protect the public interest objective. Member States could consider establishing fixed minimum and/or maximum tariff requirements with which the service providers must comply, especially for services where this is necessary for the effective application of the principle of reimbursing costs, as long as such restriction is proportionate and, where necessary, derogations from the minimum and/or maximum tariffs are provided for. Where the introduction of additional requirements duplicates requirements which have already been introduced by a Member State in the context of other rules or procedures, such requirements cannot be regarded as proportionate to achieve the objective pursued.

               (29)

               Under Title II of Directive 2005/36/EC, Member States cannot impose on service providers established in another Member State providing professional services on a temporary and occasional basis requirements or restrictions prohibited in that Directive, such as authorisation by, registration with, or membership of, a professional organisation or body or having representatives on the territory of the host Member State for the purposes of having access to, or the pursuit of, a regulated profession. Member States can, where necessary, require service providers wishing to provide services on a temporary basis, to provide information in the form of a written declaration to be made in advance of the first service provision and to renew this declaration on a yearly basis. Therefore, in order to facilitate the provision of professional services, it is necessary to reiterate, taking into account the temporary or occasional nature of the service, that requirements, such as automatic temporary registration or pro forma membership of a professional organisation or body, prior declarations and document requirements, as well as the payment of a fee or any charges, should be proportionate. These requirements should not lead to a disproportionate burden on service providers nor should they hinder or render less attractive the exercise of the freedom to provide services. Member States should, in particular, assess whether the requirement to provide certain information and documents in accordance with Directive 2005/36/EC and the possibility of obtaining further details by way of administrative cooperation between Member States through the Internal Market Information System are proportionate and are sufficient to prevent a serious risk of circumvention of the applicable rules by service providers. This Directive should however not apply to measures designed to ensure compliance with applicable employment terms and conditions.

               (30)

               As confirmed by settled case-law, the health and life of humans ranks foremost among the interests protected by the TFEU. Consequently, Member States should duly take account of the objective of ensuring a high level of human health protection when assessing requirements for healthcare professions, such as reserved activities, protected professional title, continuous professional development or rules relating to the organisation of the profession, professional ethics and supervision, while respecting the minimum training conditions, laid down in Directive 2005/36/EC. Member States should in particular ensure that the regulation of healthcare professions, having public health and patient safety implications, is proportionate and contributes to the guaranteeing of access to healthcare, recognised as a fundamental right in the Charter, as well as to safe, high quality and efficient healthcare for citizens on their territory. In establishing policies for healthcare services, account should be taken of the need to ensure accessibility, a high quality of service, and an adequate and safe supply of medicinal products, in accordance with the public health needs in the territory of the Member State concerned, as well as of the need to ensure the professional independence of healthcare professionals. With regard to the justification for the regulation of healthcare professions, Member States should take into account the objective of ensuring a high level of human health protection, including accessibility and high quality of healthcare for citizens, and adequate and safe supply of medicinal products, taking into consideration the margin of discretion referred to in Article 1 of this Directive.

               (31)

               It is essential for the proper functioning of the internal market to ensure that Member States provide information to citizens, representative associations and other relevant stakeholders, including social partners, before introducing new, or amending existing, requirements restricting access to, or the pursuit of, regulated professions. Member States should involve all parties concerned and give them the opportunity to make their views known. Where relevant and appropriate, Member States should carry out public consultations in accordance with their national procedures.

               (32)

               Member States should also give full consideration to citizens’ rights of access to justice, as guaranteed by Article 47 of the Charter and Article 19(1) of the Treaty on European Union (TEU). It follows that, in accordance with procedures laid down in national law and constitutional principles, national courts should be able to assess the proportionality of requirements falling within the scope of this Directive, in order to ensure, for each natural or legal person, the right to an effective remedy against restrictions on the freedom to choose an occupation, on the freedom of establishment and on the freedom to provide services.

               (33)

               For the purposes of exchanging information on best practices, Member States should take the necessary measures to encourage the sharing of adequate and regularly updated information with other Member States on the regulation of professions, as well as on the effects of such regulation. The Commission should facilitate that exchange.

               (34)

               In order to increase transparency and to promote proportionality assessments based on comparable criteria, the information submitted by Member States, without prejudice to Article 346 TFEU, should be easily accessible in the database of regulated professions, in order to allow other Member States and interested parties to submit comments to the Commission and the Member State concerned. Those comments should be duly taken into account by the Commission in its summary report, produced in accordance with Directive 2005/36/EC.

               (35)

               Since the objectives of this Directive, namely to ensure the proper functioning of the internal market and to avoid disproportionate restrictions on access to, or the pursuit of, regulated professions, cannot be sufficiently achieved by the Member States but can rather, by reason of the scale of the action, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 TEU. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives,

         HAVE ADOPTED THIS DIRECTIVE:
   Article 1
   Subject matter
   This Directive lays down rules on a common framework for conducting proportionality assessments before introducing new, or amending existing, legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions, with a view to ensuring the proper functioning of the internal market, while guaranteeing a high level of consumer protection. It does not affect the Member States’ competence, in the absence of harmonisation, and margin of discretion to decide whether and how to regulate a profession within the limits of the principles of non-discrimination and proportionality.
   Article 2
   Scope
   1.   This Directive shall apply to the legislative, regulatory or administrative provisions of the Member States restricting access to a regulated profession or its pursuit, or one of its modes of pursuit, including the use of professional titles and the professional activities allowed under such title, falling within the scope of Directive 2005/36/EC.
   2.   Where specific requirements concerning the regulation of a given profession are established in a separate Union act which does not leave Member States a choice as to the exact way in which they are to be transposed, the corresponding provisions of this Directive shall not apply.
   Article 3
   Definitions
   For the purpose of this Directive, the definitions of Directive 2005/36/EC apply.
   In addition, the following definitions apply:

               (a)

               ‘protected professional title’ means a form of regulating a profession where the use of the title in a professional activity or group of professional activities is subject, directly or indirectly, by virtue of legislative, regulatory or administrative provisions to the possession of a specific professional qualification, and where the improper use of that title is subject to sanctions;

               (b)

               ‘reserved activities’ means a form of regulating a profession where the access to a professional activity or group of professional activities is reserved, directly or indirectly, by virtue of legislative, regulatory or administrative provisions to members of a regulated profession holding a specific professional qualification, including where the activity is shared with other regulated professions.

         Article 4

      Ex ante assessment of new measures and monitoring
   1.   Member States shall undertake an assessment of proportionality in accordance with the rules laid down in this Directive before introducing new, or amending existing, legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions.
   2.   The extent of the assessment referred to in paragraph 1 shall be proportionate to the nature, the content and the impact of the provision.
   3.   Any provision referred to in paragraph 1 shall be accompanied by an explanation which is sufficiently detailed to make it possible to appraise compliance with the principle of proportionality.
   4.   The reasons for considering that a provision referred to in paragraph 1 is justified and proportionate shall be substantiated by qualitative and, wherever possible and relevant, quantitative elements.
   5.   Member States shall ensure that the assessment referred to in paragraph 1 is carried out in an objective and independent manner.
   6.   Member States shall monitor the compliance of new or amended legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions, after adoption, with the principle of proportionality, having due regard to any developments that have occurred since the provisions concerned were adopted.
   Article 5
   Non-discrimination
   When introducing new, or amending existing, legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions, Member States shall ensure that those provisions are neither directly nor indirectly discriminatory on the basis of nationality or residence.
   Article 6
   Justification on grounds of public interest objectives
   1.   Member States shall ensure that the legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions that they intend to introduce and that the amendments that they intend to make to existing provisions are justified by public interest objectives.
   2.   Member States shall consider in particular whether the provisions referred to in paragraph 1 are objectively justified on the basis of public policy, public security or public health, or by overriding reasons in the public interest, such as preserving the financial equilibrium of the social security system; the protection of consumers, of recipients of services and of workers; the safeguarding of the proper administration of justice; ensuring the fairness of trade transactions; the combating of fraud and the prevention of tax evasion and avoidance, and the safeguarding of the effectiveness of fiscal supervision; transport safety; the protection of the environment and the urban environment; the health of animals; intellectual property; the safeguarding and conservation of the national historic and artistic heritage; social policy objectives; and cultural policy objectives.
   3.   Grounds of a purely economic nature or purely administrative reasons shall not constitute overriding reasons in the public interest, justifying a restriction on access to, or the pursuit of, regulated professions.
   Article 7
   Proportionality
   1.   Member States shall ensure that the legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions that they introduce, and that the amendments that they make to existing provisions, are suitable for securing the attainment of the objective pursued and do not go beyond what is necessary to attain that objective.
   2.   To that end, before adopting the provisions referred to in paragraph 1, Member States shall consider:

               (a)

               the nature of the risks related to the public interest objectives pursued, in particular the risks to service recipients, including consumers, to professionals or to third parties;

               (b)

               whether existing rules of a specific or more general nature, such as those contained in product safety law or consumer protection law, are insufficient for the attainment of the objective pursued;

               (c)

               the suitability of the provision as regards its appropriateness to attain the objective pursued and whether it genuinely reflects that objective in a consistent and systematic manner and thus addresses the risks identified in a similar way as in comparable activities;

               (d)

               the impact on the free movement of persons and services within the Union, on consumer choice and on the quality of the service provided;

               (e)

               the possibility of using less restrictive means to achieve the public interest objective; for the purposes of this point, where the provisions are justified by consumer protection only and where the risks identified are limited to the relationship between the professional and the consumer, and therefore do not negatively affect third parties, Member States shall assess in particular whether the objective can be attained by means that are less restrictive than reserving activities;

               (f)

               the effect of new or amended provisions, when combined with other provisions restricting access to, or the pursuit of, the profession, and in particular how the new or amended provisions, combined with other requirements contribute to and whether they are necessary for the achievement of the same public interest objective.

         Member States shall also consider the following elements where relevant to the nature and the content of the provision being introduced or amended:

               (a)

               the connection between the scope of activities covered by a profession or reserved to it and the professional qualification required;

               (b)

               the connection between the complexity of the tasks concerned and the need for those carrying them out to possess specific professional qualifications, in particular as regards the level, the nature and the duration of the training or experience required;

               (c)

               the possibility of obtaining the professional qualification by alternative routes;

               (d)

               whether, and why, the activities reserved to certain professions can or cannot be shared with other professions;

               (e)

               the degree of autonomy in exercising a regulated profession and the impact of organisational and supervision arrangements on the attainment of the objective pursued, in particular where the activities relating to a regulated profession are pursued under the control and responsibility of a duly qualified professional;

               (f)

               the scientific and technological developments which may effectively reduce or increase the asymmetry of information between professionals and consumers.

         3.   For the purposes of point (f) of the first subparagraph of paragraph 2, Member States shall assess the effect of the new or amended provision when combined with one or more requirements, bearing in mind the fact that such effects might be positive as well as negative, and in particular the following:

               (a)

               reserved activities, protected professional title or any other form of regulation within the meaning of point (a) of Article 3(1) of Directive 2005/36/EC;

               (b)

               obligations to undergo continuous professional development;

               (c)

               rules relating to the organisation of the profession, professional ethics and supervision;

               (d)

               compulsory membership of a professional organisation or body, registration or authorisation schemes, in particular where those requirements imply the possession of a specific professional qualification;

               (e)

               quantitative restrictions, in particular requirements limiting the number of authorisations to practise, or fixing a minimum or a maximum number of employees, managers or representatives holding specific professional qualifications;

               (f)

               specific legal form requirements or requirements which relate to the shareholding or management of a company, to the extent those requirements are directly linked to the exercise of the regulated profession;

               (g)

               territorial restrictions, including where the profession is regulated in parts of a Member State’s territory in a manner that is different to the way in which it is regulated in other parts;

               (h)

               requirements restricting the exercise of a regulated profession jointly or in partnership, as well as incompatibility rules;

               (i)

               requirements concerning insurance cover or other means of personal or collective protection with regard to professional liability;

               (j)

               language knowledge requirements, to the extent necessary to practise the profession;

               (k)

               fixed minimum and/or maximum tariff requirements;

               (l)

               requirements on advertising.

         4.   Before introducing new, or amending existing, provisions, Member States shall, in addition, ensure the compliance with the principle of the proportionality of specific requirements related to temporary or occasional provision of services, provided under Title II of Directive 2005/36/EC, including:

               (a)

               automatic temporary registration with or pro forma membership of a professional organisation or body, referred to in point (a) of the first paragraph of Article 6 of Directive 2005/36/EC;

               (b)

               a declaration to be made in advance pursuant to Article 7(1) of Directive 2005/36/EC, documents required pursuant to paragraph 2 of that Article or any other equivalent requirement;

               (c)

               the payment of a fee, or any charges, required for the administrative procedures, related to the access to, or the pursuit of, regulated professions which the service provider incurs.

         This paragraph shall not apply to measures designed to ensure compliance with applicable employment terms and conditions that Member States apply in accordance with Union law.
   5.   Where provisions referred to in this Article concern the regulation of healthcare professions and have patient safety implications, Member States shall take account of the objective of ensuring a high level of human health protection.
   Article 8
   Information and involvement of stakeholders
   1.   Member States shall, by appropriate means, make information available to citizens, service recipients and other relevant stakeholders, including those who are not members of the profession concerned, before introducing new, or amending existing, legislative, regulatory or administrative provisions restricting access to, or the pursuit of, regulated professions.
   2.   Member States shall appropriately involve all parties concerned and shall give them the opportunity to make their views known. Where relevant and appropriate, Member States shall carry out public consultations in accordance with their national procedures.
   Article 9
   Effective remedy
   Member States shall ensure that an effective remedy is available with regard to the matters covered by this Directive, in accordance with procedures laid down in national law.
   Article 10
   Exchange of information between Member States
   1.   For the purposes of the efficient application of this Directive, Member States shall take the necessary measures to encourage the exchange of information among Member States on matters covered by this Directive and on the particular way that they regulate a profession, or on the effects of such regulation. The Commission shall facilitate such exchange of information.
   2.   Member States shall inform the Commission of the public authorities responsible for transmitting and receiving information for the purposes of applying paragraph 1.
   Article 11
   Transparency
   1.   The reasons for considering that provisions, assessed in accordance with this Directive, are justified and proportionate, which, together with the provisions, are to be communicated to the Commission pursuant to Article 59(5) of Directive 2005/36/EC, shall be recorded by the Member States in the database of regulated professions, referred to in Article 59(1) of Directive 2005/36/EC and shall be made publicly available by the Commission.
   2.   Member States and other interested parties may submit comments to the Commission or to the Member State which has communicated the provisions and the reasons for considering that they are justified and proportionate. These comments shall be duly taken into account by the Commission in its summary report produced pursuant to Article 59(8) of Directive 2005/36/EC.
   Article 12
   Review
   1.   By 18 January 2024 and every five years thereafter, the Commission shall submit a report to the European Parliament and to the Council on the implementation and performance of this Directive, including, among other aspects, its scope and its effectiveness.
   2.   Where appropriate, the report referred to in paragraph 1 shall be accompanied by relevant proposals.
   Article 13
   Transposition
   1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 30 July 2020. They shall immediately inform the Commission thereof.
   When Member States adopt those measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States.
   2.   Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.
   Article 14
   Entry into force
   This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
   Article 15
   Addressees
   This Directive is addressed to the Member States.

      Done at Brussels, 28 June 2018.

            For the European Parliament

            The President

         A. TAJANI

            For the Council

            The President

         L. PAVLOVA

      (1)  OJ C 288, 31.8.2017, p. 43.

      (2)  Position of the European Parliament of 14 June 2018 (not yet published in the Official Journal) and decision of the Council of 21 June 2018.

      (3)  Judgement of the Court of Justice of 30 November 1995, Gebhard, C-55/94, ECLI:EU:C:1995:411, paragraph 37.

      (4)  Directive 2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of professional qualifications (OJ L 255, 30.9.2005, p. 22).


title: Directive (EU) 2017/2102 of the European Parliament and of the Council of 15 November 2017 amending Directive 2011/65/EU on the restriction of the use of certain hazardous substances in electrical and electronic equipment (Text with EEA relevance. )

text:
               21.11.2017

               EN

               Official Journal of the European Union

               L 305/8

         DIRECTIVE (EU) 2017/2102 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
   of 15 November 2017
   amending Directive 2011/65/EU on the restriction of the use of certain hazardous substances in electrical and electronic equipment
   (Text with EEA relevance)
   THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
   Having regard to the Treaty on the Functioning of the European Union, and in particular Article 114 thereof,
   Having regard to the proposal from the European Commission,
   After transmission of the draft legislative act to the national parliaments,
   Having regard to the opinion of the European Economic and Social Committee (1),
   After consulting the Committee of the Regions,
   Acting in accordance with the ordinary legislative procedure (2),
   Whereas:

               (1)

               Directive 2011/65/EU of the European Parliament and of the Council (3) on the restriction of the use of certain hazardous substances in electrical and electronic equipment (EEE) contains a request that the Commission examine the need to amend the scope of that Directive in respect of the EEE covered therein and, if appropriate, present a legislative proposal with respect to any additional exclusions related to that EEE.

               (2)

               Secondary market operations for EEE, which involve repair, replacement of spare parts, refurbishment and reuse, and retrofitting, should be facilitated to promote a circular economy in the Union. A high level of protection of human health and the environment should be ensured, including through the environmentally sound recovery and disposal of waste EEE. Any unnecessary administrative burden on market operators should be avoided. Directive 2011/65/EU allows EEE that fell outside the scope of the previous Directive 2002/95/EC of the European Parliament and of the Council (4), but which would not comply with Directive 2011/65/EU, to continue to be made available on the market until 22 July 2019. After that date, however, both the first placing on the market and secondary market operations of non-compliant EEE are prohibited. Such prohibition of secondary market operations is inconsistent with the general principles underlying Union measures for the approximation of laws relating to products and should therefore be removed.

               (3)

               Certain niche product groups should be excluded from the scope of Directive 2011/65/EU as their inclusion would bring negligible environmental or health benefits and introduce unresolvable compliance problems or market distortions that cannot effectively be addressed through the exemption mechanism provided for in that Directive.

               (4)

               Pipes in organs are built using a specific type of lead-based alloy, for which no alternative has been found so far. Most pipe organs are kept in the same place for centuries and their turnover rate is negligible. Pipe organs should therefore be excluded from the scope of Directive 2011/65/EU as their inclusion would bring negligible benefit in terms of the substitution of lead.

               (5)

               Directive 2011/65/EU does not apply to non-road mobile machinery with an on-board power source, which is made available exclusively for professional use. However, for certain types of non-road mobile machinery, two versions are produced in the same production line, with the power source (either on-board or external) being the only difference. Those versions should be treated in the same way under that Directive. Non-road mobile machinery with a traction drive powered by an external power source should therefore also be excluded from the scope of Directive 2011/65/EU.

               (6)

               For all relevant EEE categories, as set out in Annex I to Directive 2011/65/EU, the conditions for the exemption of reused spare parts, recovered from EEE, should be clearly specified. Likewise, since exemptions from the restriction of the use of certain hazardous substances should have a limited duration, the maximum validity period for existing exemptions should also be clearly specified for all relevant EEE categories, including for category 11.

               (7)

               When an application for renewal of an exemption is submitted, the Commission is required to take a decision no later than 6 months before the expiry date of the existing exemption, unless specific circumstances justify a different deadline. No deadline is specified for the Commission to take a decision on applications for new exemptions. According to the report of 18 April 2016 from the Commission to the European Parliament and the Council on the exercise of the power to adopt delegated acts conferred on the Commission pursuant to Directive 2011/65/EU, that deadline has proven to be unfeasible in practice, due to the need to follow several mandatory procedural steps for the evaluation of an application for renewal of an exemption. While the deadline brings no additional value to the existing procedure for the evaluation of applications for renewal, it entails uncertainties for businesses and other stakeholders due to its impracticability. On the other hand, business continuity is ensured since market operators are able to rely on an existing exemption remaining valid until a decision is taken on the application for renewal. Therefore, the provision related to the deadline should be removed. However, the Commission should provide to the applicant, the Member States and the European Parliament, shortly after the receipt of an application, a timeline for the adoption of its decision on the application. Furthermore, the general review of Directive 2011/65/EU to be carried out by the Commission no later than 22 July 2021 should include the specification of a realistic deadline for a decision by the Commission on an application for renewal of an exemption before the expiry of the relevant exemption.

               (8)

               Since the objectives of this Directive, which are to contribute to the protection of human health and the environmentally sound recovery and disposal of waste EEE by means of the restriction of the use of hazardous substances in EEE, cannot be sufficiently achieved by the Member States because disparities between the laws or administrative measures adopted by the Member States could create barriers to trade and distort competition in the Union and thus have a direct impact on the internal market, but can rather, by reason of the scale of the problem and its implications in respect of other Union legislation on recovery and disposal of waste and areas of common interest, such as human health protection, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives,

         HAVE ADOPTED THIS DIRECTIVE:
   Article 1
   Directive 2011/65/EU is amended as follows:

               (1)

               Article 2 is amended as follows:

                           (a)

                           paragraph 2 is deleted;

                           (b)

                           in paragraph 4, the following point is added:

                                       ‘(k)

                                       pipe organs.’;

               (2)

               in Article 3, point (28) is replaced by the following:

                           ‘(28)

                           “non-road mobile machinery made available exclusively for professional use” means machinery, with an on-board power source or with a traction drive powered by an external power source, the operation of which requires either mobility or continuous or semi-continuous movement between a succession of fixed working locations while working, and which is made available exclusively for professional use.’;

               (3)

               Article 4 is amended as follows:

                           (a)

                           paragraph 3 is replaced by the following:
                           ‘3.   Paragraph 1 shall apply to medical devices and monitoring and control instruments which are placed on the market from 22 July 2014, to in vitro diagnostic medical devices which are placed on the market from 22 July 2016, to industrial monitoring and control instruments which are placed on the market from 22 July 2017, and to all other EEE that was outside the scope of Directive 2002/95/EC and which is placed on the market from 22 July 2019.’;

                           (b)

                           in paragraph 4, the following point is inserted:

                                       ‘(ea)

                                       all other EEE that was outside the scope of Directive 2002/95/EC and which is placed on the market before 22 July 2019;’;

                           (c)

                           paragraph 5 is replaced by the following:
                           ‘5.   Provided that reuse takes place in auditable closed-loop business-to-business return systems, and that the reuse of spare parts is notified to the consumer, paragraph 1 shall not apply to reused spare parts:

                                       (a)

                                       recovered from EEE placed on the market before 1 July 2006 and used in EEE placed on the market before 1 July 2016;

                                       (b)

                                       recovered from medical devices or monitoring and control instruments placed on the market before 22 July 2014 and used in EEE placed on the market before 22 July 2024;

                                       (c)

                                       recovered from in vitro diagnostic medical devices placed on the market before 22 July 2016 and used in EEE placed on the market before 22 July 2026;

                                       (d)

                                       recovered from industrial monitoring and control instruments placed on the market before 22 July 2017 and used in EEE placed on the market before 22 July 2027;

                                       (e)

                                       recovered from all other EEE that was outside the scope of Directive 2002/95/EC and which is placed on the market before 22 July 2019, and used in EEE placed on the market before 22 July 2029.’;

               (4)

               Article 5 is amended as follows:

                           (a)

                           in paragraph 2, the second subparagraph is replaced by the following:
                           ‘For the exemptions listed in Annex III as at 21 July 2011, unless a shorter period is specified, the maximum validity period, which may be renewed, shall be:

                                       (a)

                                       for categories 1 to 7 and category 10 of Annex I, 5 years from 21 July 2011;

                                       (b)

                                       for categories 8 and 9 of Annex I, 7 years from the relevant dates laid down in Article 4(3); and

                                       (c)

                                       for category 11 of Annex I, 5 years from 22 July 2019.’;

                           (b)

                           in paragraph 4, the following point is inserted:

                                       ‘(ba)

                                       within 1 month of receipt of an application, provide to the applicant, the Member States and the European Parliament a timeline for the adoption of its decision on the application;’;

                           (c)

                           in paragraph 5, the first sentence of the second subparagraph is deleted.

         Article 2
   1.   Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 12 June 2019. They shall immediately inform the Commission thereof.
   When Member States adopt those measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States.
   2.   Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.
   Article 3
   This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
   Article 4
   This Directive is addressed to the Member States.

      Done at Strasbourg, 15 November 2017.

            For the European Parliament

            The President

         A. TAJANI

            For the Council

            The President

         M. MAASIKAS

      (1)  OJ C 345, 13.10.2017, p. 110.

      (2)  Position of the European Parliament of 3 October 2017 (not yet published in the Official Journal) and decision of the Council of 23 October 2017.

      (3)  Directive 2011/65/EU of the European Parliament and of the Council of 8 June 2011 on the restriction of the use of certain hazardous substances in electrical and electronic equipment (OJ L 174, 1.7.2011, p. 88).

      (4)  Directive 2002/95/EC of the European Parliament and of the Council of 27 January 2003 on the restriction of the use of certain hazardous substances in electrical and electronic equipment (OJ L 37, 13.2.2003, p. 19).