The Single Market Emergency Instrument (SMEI) - a BusinessEurope position paper

Key messages

• A significantly narrower scope limited to protection of the Single Market freedoms, the focus on cooperation with industry by giving it a more prominent role instead of new obligations, and the simplification of decision-making which could be possible under a narrower scope, are the prerequisites for SMEI adoption.
• Protection of the Single Market freedoms in times of crises and control over the crisis mitigation measures so that they meet the basic principles of necessity, proportionality and non-discrimination should be the underlying SMEI objectives; BusinessEurope could support respective articles in the proposal.
• SMEI goes far beyond the above-mentioned objectives, therefore we do not support such an extended scope. The supply chain challenges require much more tailormade approaches, are the subject of industrial policy and do not fall under the proposal’s legal base (Articles 21, 45 and 114 of the Treaty on the Functioning of the European Union), therefore respective provisions on the scope and under the vigilance and emergency modes should be deleted in their current form.
• Practical application of SMEI and its impact, enforceability and interplay with other EU legislation addressing crisis situations or industrial, IPR, competition and trade policy issues remain the questions requiring thorough additional explanation.
• BusinessEurope maintains that the change in balance of powers among the EU, Member States and industry as proposed in SMEI is disproportionate and public intervention is excessive; however, we support additional obligations on Member States to ensure administrative cooperation and transparency in times of crises.
• Emergency response measures under part IV title III should be largely refocused from a commanding model towards a model of cooperation between the Commission, Member States and industry.
• Effects of the vigilance and emergency measures on relations with trading partners as well as compatibility with the WTO rules should be considered and respective amendments made.
• Industry, as key player under SMEI, should be a permanent fully-fledged member of the Advisory Group that should have its decision-making role throughout the contingency, vigilance and emergency stages.