Business services

Business services are particularly important to European competitiveness as they are essential to manufacturing and other service sectors. They are also increasingly being used to enhance the value of products through new combinations of goods and services and play a central role in the 'servitisation' of the European economy.

There is significant untapped growth potential for business services in the EU today. While they currently face relatively low average productivity and persisting legal barriers, EU Internal Market legislation and policy actions aim at removing these obstacles and stimulating competitiveness in the sector.

EU legislation

There are two EU Directives that support the business services sector in particular:

• The Services Directive allows business service providers to more easily establish in another EU country or provide services across borders. This Directive covers a large number of business services but there are exceptions such as private security services, temporary work agency services and notarial services.
• The Professional Qualifications Directive facilitates the recognition of professional qualifications for those wishing to work in another EU country. This Directive covers regulated professions that largely offer their services to businesses such as accountants, lawyers, consultants and engineers.

Study on formalities and costs involved in accessing markets cross-border for accountancy, engineering and architecture services

The European Commission recently conducted a study that identifies the formalities and the related costs imposed on certain businesses providing cross-border services. The study found that businesses engaging in cross-border service provision were confronted with significant administrative barriers and high costs in several EU countries.

Study: Administrative formalities and costs involved in accessing markets cross-border for provisions of accountancy, engineering and architecture services

High Level Group on Business Services

To analyse the untapped potential of this important sector and provide a new impetus to policy development, the European Commission set up a a href="https://web.archive.org/web/20150530053437/http://ec.europa.eu/enterprise/policies/industrial-competitiveness/industrial-policy/hlg-business-services/index_en.htm">High Level Group on Business Services (web archive). This initiative was announced in two flagship communications: An Integrated Industrial Policy for the Globalisation Era and A Single Market Act I.

• High Level Group on Business Services final report (3 MB)
• Study on the relation between industry and services in terms of productivity and value creation – Final report (2 MB) carried out by ECORYS in preparation for the High Level Group