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REPORT (COM(2022)0459 – C90315/2022 – 2022/0278(COD))

On the proposal for a regulation of the European Parliament and of the Council establishing a Single Market emergency instrument and repealing Council Regulation No (EC) 2679/98

A-9-2023-0246

Committee on the Internal Market and Consumer Protection · Rapporteur: Andreas Schwab

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Parliament's amended version of the Commission proposal for a regulation establishing an internal market emergency and resilience framework, replacing the Single Market emergency instrument and amending Council Regulation (EC) No 2679/98. It sets up an Internal Market Emergency and Resilience Board, central liaison offices, stress tests, crisis protocols and a mapping of critical sectors. It creates a vigilance mode of up to six months and an emergency mode activated by legislative act, with a list of crisis-relevant goods and services. During an emergency it bans restrictions on free movement unless justified, non-discriminatory and proportionate, and requires Member States to notify such measures. It allows the Commission to request information, invite priority-rated orders, recommend distribution of strategic reserves and procure jointly on behalf of Member States. It requires digital tools, fast lanes, a public website on national restrictions and a stakeholder platform, and provides for fines for non-compliance with priority-rated orders.

Committee position. The committee proposes to amend the Commission proposal by renaming it the Internal Market Emergency and Resilience Act, strengthening resilience, free movement and parliamentary scrutiny, and making market interventions a last resort.

Key points

  1. The regulation aims to strengthen the resilience of the internal market, anticipate and prevent crises, ensure an effective response and facilitate free movement of goods, services and persons.
  2. It establishes an Internal Market Emergency and Resilience Board, composed of one representative per Member State and one expert appointed by Parliament, chaired by the Commission.
  3. Member States must designate central liaison offices, and the Commission a Union-level central liaison office, for coordination and information exchange.
  4. The Commission is empowered to adopt a delegated act setting out crisis protocols, and must conduct stress tests at least every two years and map critical sectors.
  5. Member States must make best efforts to build strategic reserves of goods of critical importance, with Commission support for coordination and information exchange.
  6. The vigilance mode is activated by implementing act for a maximum of six months, extendable once, and requires monitoring of supply chains of critical goods and services.
  7. The internal market emergency mode is activated by legislative act for a maximum of six months, extendable, and the Commission must adopt a list of crisis-relevant goods and services.
  8. Restrictions on free movement imposed by Member States during an emergency are prohibited unless justified by public policy, public security or public health, and must be non-discriminatory and proportionate.
  9. Member States must notify the Commission of draft measures restricting free movement and of adopted measures restricting free movement of persons, with reasons and evidence.
  10. The Commission may invite economic operators to provide information voluntarily, and if they do not, may request it by recommendation, with a time limit not exceeding 14 days.
  11. The Commission may invite economic operators to accept priority-rated orders, and may require them by implementing act if they refuse, with fines for non-compliance.
  12. The Commission may recommend that Member States distribute strategic reserves, and may procure jointly on behalf of Member States, with participation open to EFTA States and candidate countries.

Who is affected

  • Member States, which must designate liaison offices, notify restrictions, build strategic reserves and coordinate procurement.
  • Economic operators, including SMEs, which may be asked for information, priority-rated orders and face fines.
  • Workers and service providers, whose free movement must be facilitated and who must be informed of restrictions.
  • Citizens and consumers, who must receive information on national crisis measures through single points of contact.
  • The Commission, which gains powers to activate modes, request information, issue priority-rated orders and procure jointly.

Figures and deadlines

  • Vigilance mode maximum duration of six months, extendable by six months.
  • Emergency mode maximum duration of six months, extendable by six months.
  • Information request time limit not exceeding 14 days, with one-time extension possible.
  • Fines for failure to comply with priority-rated orders shall not exceed 1% of global turnover, or 0.25% for SMEs.
  • Fines for other infringements shall not exceed 200 000 EUR, or 25 000 EUR for SMEs.
  • Commission must examine notified measures within 10 days, extendable to a maximum of 30 days.
  • Commission may issue a decision requiring modification within 15 days of communication.
  • Stress tests must be conducted at least once every two years.

Legal basis: Article 294(2) and Articles 114, 21 and 46 of the Treaty on the Functioning of the European Union.