One of the main themes of David Cameron’s recent speech seemed to be deep regret that the EU was just not good enough for the UK. If only it were, he would be delighted to recommend staying. And so he gave poor Johnny Foreigner an ultimatum to pull up his socks for once and all. The UK government requires the EU to be more competitive, more flexible, more fair – just like in Britain. You wouldn’t have guessed from his speech that there had been recent major upheavals and scandals in the UK caused by the banking and newspaper industries, to take just two, for failing those same criteria, with his government having to be pushed to deal with their fall-out.
I want to test the truth of his speech against the sector I know best, that of legal services. When you examine it, you find that the EU has a powerful range of new initiatives trying to make legal services more competitive, some under the heading of ‘Justice for Growth’, which the commissioner for justice, Viviane Reding, is pushing hard. Here are some examples. (I should add that reciting the list does not signify my approval of its content. This is all about showing how active the EU is in the areas where it is being condemned for being – sigh – just not up to the UK’s standards.)
The EU is currently reviewing the working of the lawyers’ sectoral directives, to be sure that they are modern and relevant. This will cover all forms of cross-border legal practice, including also legal structures. The European Commission will publish in March a major piece of research into this evaluation. At the same time, it has commissioned a study into alternative business structures in the field of legal services, among others. The commission has indicated that it will take action to change the current legislative framework, if necessary.
The commission is just completing yet another study, called ‘The functioning of judicial systems and the situation of the economy in the European Union member states’, undertaken by a committee of the Council of Europe. It will be followed by a communication in March or April of this year, containing a ‘Justice scoreboard’ which will gauge the various strengths and weaknesses of each member state by benchmarking judicial ‘strength, efficiency and reliability’. (One of the points made in the report was that a number of countries have, in the view of the authors, too many lawyers.)
The Annual Growth Survey 2013 was published on 28 November 2012, encouraging member states, among other things, to improve the implementation of the Services Directive by reviewing the necessity and proportionality of regulation of professional services, in particular fixed tariffs, and limitations on company structures and capital ownership.
The Entrepreneurship 2020 Action Plan was published on 9 January 2013, which foresees the setting up of a working group to assess the specific needs of liberal profession entrepreneurs in relation to issues such as simplification, internationalisation or access to finance.
Finally, work is continuing on a major EU-funded project to enable cross-border electronic transactions in the future across the EU, which will give European lawyers a significant competitive edge.
At the recent EU Justice Council, Commissioner Reding drew attention to two items which had made progress under her ‘Justice for Growth’ agenda – the data protection package and the modernisation of rules in cross-border insolvencies. She includes other topics in this area, such as a possible future European contract law (which I know is not popular in the UK). And there have been steps recently to agree to the establishment of a streamlined new European patent regime.
It should not need pointing out that the legal services group which will doubtless benefit most from these various measures are solicitors of England and Wales, who have already taken advantage of the single market to grow their presence in most, if not all, European countries.
This does not look to me like a sector which needs to be shamed into action by the prime minister. Of course, legal services might be exceptionally active in just those fields that the prime minister highlights as being necessary for the UK to agree to stay. Or the prime minister might be creating Aunt Sallies for purposes not related to the functioning of the EU but rather to the needs of his own party. In legal services at least, Johnny Foreigner’s socks are right up to the knee.
Jonathan Goldsmith is secretary general of the Council of Bars and Law Societies of Europe, which represents about one million European lawyers through its member bars and law societies. He blogs weekly for the Gazette on European affairs