International News

Study Highlights Differences in European Regulation of Liberal Professions

October 2003 saw the European Commission release an overview of regulation in European Union (EU) member states that highlights different approaches across the continent. Focusing on six major liberal professions (lawyers, notaries, accountants, architects, engineers and pharmacists), the report is part of a review of professional regulations and their impact on competition and the consumer.

The report highlights anti-competitive practices across "a large number of the EU professions" such as restrictions on entry to the profession, price regulation, recommended prices and limits or prohibitions on advertising. It suggests that Austria, Germany, Greece, Italy and Luxembourg have tighter regulatory regimes than do Denmark, Finland, Ireland, the Netherlands and the United Kingdom which have adopted a more flexible approach.

The report also suggests that the most highly regulated professions are notaries and pharmacists. A restriction is placed in nearly all EU countries (outside Ireland and the United Kingdom), where fixed prices are imposed for notaries' services. Similarly pharmacists' numbers are regulated in many Member States, and in many have a monopoly on the right to sell both prescription and non-prescription medicines. The regulation of the legal and accountancy professions is described as "relatively highly regulated", restrictions being in place regarding advertising and fixed or recommended prices. Least regulated are architects and engineers who are judged to "function effectively ... without significant anti-competitive rules" in Denmark, Finland, Ireland, the Netherlands and the United Kingdom.

Also included in the report are a listing of key restrictions and an overview of regulation by profession that focuses on entry and exclusive rights; price regulation; contingency fees; advertising restrictions; business structure and inter-professional co-operation.

On October 28 Competition Commissioner Mario Monti addressed a conference regarding professional regulation and the role of competition. He has stressed his belief in the importance of competition in this sector, to include a wide variety of service providers to consumers. The overall context of the work Commissioner Monti and the Commission is undertaking is that in 2000 the European Council set the EU the ambitious goal of becoming the most competitive and dynamic knowledge-based economy in the world by 2010.

Resources
- Stocktaking Exercise on Regulation of Professional Services: Overview of Regulation in the EU Member States
- Commissioner Monti's Concluding Remarks at the 28 October, 2003 Conference (including an overview of his perspective of the position in the United States)
- Opening Remarks of 28 October, 2003 Conference
- Competition in Professional Services: New Light and New Challenges - March 2003 speech by Mario Monti

European Commission Gives Notice Regarding Recommended Fees

The Competition Directorate of the European Commission has made a "statement of objections" to the Belgian Architects' Association regarding its recommended minimum fee scale. The Commission took the view that such fee scales may constitute a violation of EU competition rules, particularly where they fail to reflect the costs and ability required, and more generally as they may limit competition on price. This preliminary ruling from the Commission finds that the Association may have overstepped its regulatory authority by adopting the fee scale. The Commission has also made clear that it will review similar rules in other Member States where it may well find similar violations.

Resources
- European Commission Competition Directorate
- Belgian Architects Association

Next