France reviews precautionary principle

France is probably one of the only countries to have written the precautionary principle into its Constitution, in 2005. The need to forestall any re-occurence of the "scandal of the contaminated blood" was one of the driving forces behind the reform. Attention has recently been drawn back to the issue by the excessive precautions taken against the swine flu that did not materialise, and again yesterday 21 June by the publication of a report on the past hasardous effects of an insecticide in the Antilles. Earlier this month, Parliament held a seminar bringing together lawyers, philosophers, academics and others to publicise and discuss the results of a parliamentary review of the implementation of this principle. Today, Parliament examined the report.
The 2005 constitutional amendment introduced a Chart of the Environment defining conditions (grave danger, uncertain scientific evidence) in which specific risk assessment procedures and conservatory measures should be used. The drafters of the review have noticed that the principle was being applied to a wider range of issues than initially foressen (on this see previous post on this blog) and call for a new text to further specify the conditions, stressing proportionality and insisting that precautionary measures should always be temporary. Good dossier on Vie-Publique.fr (in French.)

"Human rules:" a new approach to regulation

Belgium, which will take up the presidency of the EU on 1 July for six months, organised a (restricted) conference on 17-18 June in Ghent. It stated its ambition to take a fresh look at regulatory quality and management, settin g up a good looking dedicated website: http://www.humanrules.be/ Extract from the homepage: "It is clear that some of the actual regulatory mechanisms have shown deficiencies and need to be revised and even re-designed. Recent reports and the launching of the open stakeholder consultation on smart regulation aim at activating this debate. This year's meeting of the Directors and experts of better regulation (DBR) will contribute to this debate by looking at this theme from new angles but with one common factor : people will be in the centre of our attention". This was the theme of an original conference, including a "field work" session (canvassing local inhabitants), the purpose being to unleash "creative thinking." The site already offers a definition of "human rules", as the next step for regulatory quality: it may be worth watching for the announced "booklet on human rules" compiled from participants' contributions.

Portugal launches new phase of SIMPLEX

Our colleague Susana Brito is circulating an official presentation of the new phase of the well known SIMPLEX programme, called SIMPLEGIS, launched in Lisbon in May, and comprising three main components, aimed at both citizens and businesses:

• net reduction the number of laws, by-laws and amendments, repeal of obsolete legislation and faster transposition of EU law,
• better quality legal acts thanks to training of legal experts, improved access for citizens (including summaries in plain language, in Portuguese and English, and online publication on specific websites) and systematic codification;
• improved enforcement, to be achieved by helping stakeholders understand the content of legislation, and more comprehensive ex post evaluation.

There is also a Q&A document. This new document offers a specific approach to Better Regulation, based on the search for better legal quality of texts, and easier retrieval and access to the corpus, rather than on a more comprehensive study and limitation of their impact. We would also need a summary of the results of SIMPLEX over the past years.

For more information, see official brochure and webpages from Secretary of State for modernisation, French ministry of modernisation (in French) and OECD report.

New British cabinet outlines regulatory strategy

UK Business Secretary Vince Cable announced on 2 June an action plan to bring an end to the excessive regulation that is stifling business growth. He detailed the first phase of the Coalition Government's action plan to reduce regulation following the Prime Minister's commitment last week to "re-open Britain for business". The action plan:

• Creates a new Cabinet "Star Chamber" that will lead the Government's drive to reduce regulation which is stifling growth, especially of small businesses. This Reducing Regulation Committee will be chaired by the Business Secretary and will enforce a new approach to new laws and regulations, ensuring that their costs are being properly addressed across the entire British economy.
• Announces an immediate review of all regulation in the pipeline for implementation which has been inherited from the last Government. The cost of implementing this amounts to £5bn annually before April 2011 and £19.1bn per annum thereafter. This will be the first action for the new Cabinet committee.
• Establishes a new "challenge group" to come up with innovative approaches to achieving social and environmental goals in a non-regulatory way. This team would work with experts including Richard Thaler, the US behavioural economist.
• Introduces a new approach that will control and reduce the burden of regulation. A "one-in, one-out" approach, designed to change the culture of government, would make sure that new regulatory burdens on business are only brought in when reductions can be made to existing regulation. (from the official website).

European Parliament votes for simpler food labelling

On 16 June, the EP voted in plenary on a 2008 Commission proposal for new legislation on providing food information to consumers. The proposal combines existing rules on food labelling and nutritional information into one regulation. The aim is to make food labels clearer and more relevant to consumers, without introducing excessive labelling costs for the packaging industry. The regulation includes specific requirements for displaying information on the front of packaging. A significant part of the discussion centrered around "traffic-light" labelling supposed to provide dietary information. It seems that the some balance has been struck, in the new legislation, between the need to inform consumers, without imposing unnecessary and often illegible labels on food packages, a permanent challenge for quality regulation. Some countries, such as the Netherlands, do not consider third party labelling as administrative burdens. For background information, see Euractiv dossier.

A new source of legislative initiative

The General Affairs Council yesterday (14 June) outlined a "general approach" to the European Citizens' Initiative, paving the way for citizens to call on the European Commission to table legislative proposals on specific issues. 

No doubt this development will generate many comments, most of them welcoming this new democratic tool to express the vox populi. But we BR experts know that the statute book is already replete with volumes of legislation on all possible topics, and that politicians are rarely slow to seize the mood of the public when it is asking for more regulation. But this key item of the Lisbon Treaty may still prove useful, as it is aimed at supplementing the Commission's right of proposal. See European Council site, and Euractiv dossier, for more.

EESC advocates 28th regime

In a press release issued last week, the European Economic and Social Committee advocated offering businesses and consumers the right to choose common rules in certain sectors: the EESC's own-initiative opinion on "The 28th regime" (rapporteur Jorge Pegado Liz, Group III, Various Interests – Portugal), adopted at its May plenary session, is part of the EESCs contribution to discussions on "better lawmaking". The 28th regime, an optional instrument that leaves national legislation intact, constitutes an alternative to the traditional harmonisation approach by offering a set of common rules for national and cross-border trade.
We remember that the Monti report (May 2010) also backed the 28th regime option: "Harmonisation through regulations can be most appropriate when regulating new sectors from scratch and easier when the areas concerned allow for limited interaction between EU rules and national systems. In other instances, where upfront harmonisation is not the solution, it is worthwhile exploring the idea of a 28th regime, a EU framework alternative to but not replacing national rules. The advantage of the 28th regime is to expand options for business and citizens operating in the single market: if the single market is their main horizon, they can opt for a standard and single legal framework valid across Member States; if they move in a predominantly national setting, they will remain under the national regime". (p.93)
The EESC also publishes on its site full information on self regulation and co regulation, and a comprehensive table of useful links, in a site managed by the Single Market Observatory. Experts should particularly check out past opinions of the EESC on better regulation(2008), better application of EU law, simplification.
Reminder: the Committee of Regions also publishes interesting opinions on these subjects, containing a lot of information, see recent post on this blog. (with JP Faure).

France restructures local government

An important draft legislation was voted yesterday by the national assembly to introduce some historical changes in the structure and competencies of French local authorities. It is one of Mr Sarkozy's flagship initiatives, and has been quite laborious in getting through Parliament. It still needs to go back to the Senate for final approval or further legislative work. In a country renowned for an efficient centralised system, how will local democracy be improved by this reform? Will it help tackle the regulatory quality challenges? Answers are of course not ready, but we can take a look at the innovations, as they currently stand:

• reduction, nearly by half, of locally elected officials: 3500 conseillers territoriaux, acting at both département and region level, replacing two corps totalling 6000 councilors, a move welcomed by taxpayers;
• the possibility for départements and regions to amalgamate, by no means a panacea for those who consider that there are too many small non viable regions; the purpose of the change is to sooner or later combine the two levels, where it would be more efficient;
• a count-down towards a clarification of the competencies of regions and départements with 2014 as the target for clearing any misunderstandings;
• various technical measures to improve the management of larger cities, including a new type of authority, "metropolis", for conurbations beyond 450,000 inhabitants, that could be granted a wide range of powers beyond those of a group of communes (including transfers from the département, the region and even central government).

COR work on multilevel governance and BR

Following a recent post on this blog, a Committee of Regions friend of the network points out for us some interesting documents from that advisory body.

The CoR regularly publishes opinions on the EU better regulation agenda, the most recent dealing with the Commission 2nd and 3rd strategic reviews of BR.

Earlier opinions address the regular Better Lawmaking reports from the Commission (drawn up in conformity with the protocol on subsidiarity and proportionality), and related communications:

• Better lawmaking 2005-2006
• Better lawmaking 2004
• Better lawmaking 2002

The White Paper on multilevel governance offers an impressive background study and a number of recommendations on integrating the multilevel dimention into policy making at the European level: including "territorial action plans" to accompany stratregic reforms, territorial impact analysis, and the development of participatory governance indicators and territorial indicators, in conjunction with regional and local authorities. The CoR envisages to contribute to the use of "instruments" of Better regulation such as impact assesmment .

Impending simplification of GMO authorization

As announced in March, the Commission is working on a review of its approval system for genetically modified (GM) crops. With most Europeans showing no appetite for GM produce in food, EU politicians have approved just two varieties for growing in 12 years, compared to more than 150 worldwide. Following an in-depth evaluation of GMO policy, proposals due to be adopted on 13 July, will give the European Commission greater freedom to approve new GM varieties for cultivation, in return for letting EU governments decide whether or not to grow them. According to the press release shows that EU policy is to be based on scientific assessment of health risks and sustainable innovation, and challenging the "instinctive fear and suspicion (that had) taken hold among European consumers due to scaremongering and a reluctance of industry to explain the science behind their products" (J. Dalli). This "regulatory risk" approach to EU law is consistent with President Barroso's new political guidelines. Good background on Euractiv dossier.

Where is RIA in France, one year on?

France offers an example of impact assessment introduced by a political commitment at the highest possible level, a constitutional obligation regarding the preparation of new laws, backed up if necessary by the constitutional court. One year after the adoption of the organic law of 25 April 2009, all the implementation measures have been taken by ministries, as reported by the central unit in charge. A recently published informal dossier provides links to the publicly available documents, demonstrating the sustained lead taken by the legislative authority in the process. The national assembly has set up a mechanism to offer stakeholders and the public the possibility of voicing their opinion on currently open impact assessments, which are themselves uploaded in full text. The methodology is also on line, in the form of a study by a reputed public evaluation body, but the practical methods employed in the ministries are not publicly available. Finally, we have recently been given an idea of how the new scheme operates, with the report on the online consultation concerning one of the new laws (on the supply of electricity). Concerning the administrative burden impact, the best published source of information is a 2007 report by the IGF (general inspection of finances), which led to the creation of an IT tool used by all ministries (OSCAR). All in all, the specificity of the French approach to RIA is apparently confirmed: it is Parliament-driven, rather than an internal tool supporting decision making within government.

Swedish update on regulatory costs

The Board of Swedish Industry and Commerce (NNR) has now published the English translation of its report "The Total Cost of Regulations to Businesses in Sweden - 2008 compared with 2005". Results show that changes to financial regulatory obligations have had more of an impact than changes to administrative obligations on the total cost to business. In spite of very numerous simplification measures taken by the Government, it seems the effects on the ground are limited.
Summary by D. Besnainou: The Board of Swedish Industry and Commerce for Better Regulation (NNR), is an independent, non-party political organisation. NNR is entirely financed by its members, who include 15 Swedish business organisations and trade associations that together represent more than 300,000 companies. (a third of all active enterprises in Sweden, in every sector and of all sizes). NNR is also an active advocate of regulatory reform at EU level and chairs the BUSINESSEUROPE Better Regulation Working Group.
This report is based on in-depth discussion with 6 companies on their administrative burdens:
For each company, the report describes the regulatory burden trend, the distribution of regulatory costs in 2005 and 2008 per segment (administrative, financial and material) and per category (labour market, environment, taxes and sector). The report also includes the opinions of the companies on future change and needs.
The general conclusion of the report is "In all, the companies have in quite different ways been affected by the implemented changes. For three of the companies, changes in costs were virtually non-existent from an overall perspective. One company, Tranås Energi, reported substantially higher costs due to additional requirements in sector regulations. For WelcomeGruppen, costs dropped by 8.9%, a decrease linked entirely to lower employer contributions.
A close examination of the report shows that there was no increase of administrative burden between 2005 and 2008, according to the SCM methodology. Reduction of costs is visible in all companies, due to new legislation on employment which reduces the costs of hiring younger people. This reduction is not completely compensated for with the increase of burden in, for example, time spent reporting on or obtaining permits.

The "28th system" envisaged for contract law

The European Commission, seeking to boost cross-border trade and to ensure strong rights for consumers, convened a new expert group to propose ways to improve contract law (for a Common Frame of Reference) in the European Union. The group of 18 contract law experts, lawyers and consumer representatives met for the first time on 26 April in Brussels. The Commission will launch a public consultation on the most appropriate way forward to improve coherence in contract law in the summer. A possible solution could be an optional European contract law (or "28th system"). For example, an Irish retailer dealing with a French supplier, who is unfamiliar with French law, could opt for European law for the contract. In addition, a Polish consumer shopping on the Internet could push a "blue button" on the website and choose the European contract law instrument, which would guarantee a high level of consumer protection. See Commission press release for details.

Rich batch of reports on national BR policies

What is the best source of information about national BR programmes? Answer: OECD's country reviews. These reports aim at assisting governments to improve regulatory quality, i.e.to reform regulations to foster competition, innovation, economic growth and important social objectives. The review methodology draws on the 2005 Guiding Principles for Regulatory Quality and Performance updated by later OECD research and embodied in a reference "baseline". For the "older" members of the European Union (those that had joined before 2004), all the reports are being updated, some are already available, and we will soon have a complete up-to-date picture, thanks to the EU 15" project, which aims to assess capacities for effective regulatory management , through individual reviews of the MS concerned. The reports are compiled by the OECD in partnership with the European Commission. The project started in 2008 and will be completed in 2010. It will culminate in a synthesis that will highlight key conclusions and map out a path for effective regulation in support of key public policy goals (all details supplied by the OECD site). After an initial series of 4 reports, the second batch is currently being published. An overview of published reports is available online, along with some main conclusions of each report. Full text of the reports can be bought from the OECD bookshop.

News from the self-regulation world

Here are my meeting notes of the CEPS lunchtime seminar on Self Regulation and Regulation where I got a good update on how self regulation had been contributing to the wider BR agenda (we classify self regulation among the "alternatives to regulation" with co-regulation and softlaw).

Auditors assess EU RIA

Experts interested in impact assessment at the European level will read with interest the preliminary observations of the European Court of Auditors " Impact assessments in the EUinstitutions: do they support decision making?" Here are some extracts praising the performance and suggesting avenues for improvement.

Commission proposes simplified access to EU funds

"The Commission has adopted changes to simplify access to EU funds by cutting red tape and saving costs for EU beneficiaries. New rules will also provide more scope for combining public and private funding for a bigger investment impact. The changes will help deliver the new generation of EU programmes post 2013."
Changes proposed by the Commission need to be adopted by the European Parliament and the Council. The Commission expects the legislative process to be completed by the end of 2011.
For more information, see press release dated 28 May and Q&A.