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					Latest development in EU
  legislation – national
   implemention issues
   21st IFTTA Conference
     Sao Paulo, Brasil,
     2-6 October, 2009
    Dr Gyenizse Dorottya
           Hungary
 Ministry of Local Government
     Tourism Department
Topics
The implementation of 2006/123/EC
Directive on services in the internal
market
Proposal for a new directive on
consumer rights
Overview of the latest Hungarian
legislation      and         national
implementation process
 2006/123/EC Directive on services in the internal
 market

Directive 2006/123/EC of the European Parliament and of the
Council of 12 December 2006 on services in the internal
market is in force since 27th December 2006 after 3 years
preparatory process. Implementation period: till 31th
December, 2009.
The Directive falls under the framework of the 'Lisbon
Strategy' and proposes four main objectives for creating an
internal services market:
•to ease freedom of establishment for providers and the
freedom of provision of services in the EU;
•to strengthen rights of recipients of services as users of the
latter;
•to promote the quality of services;
•to establish effective administrative cooperation among the
Member States.
 2006/123/EC Directive on services in the internal
 market
Scope

The services covered by the Directive: business services
such as management consultancy, certification and
testing; facilities management, including office
maintenance; advertising; recruitment services; the
services of commercial agents, legal or fiscal advice; real
estate services such as estate agencies; construction,
including the services of architects; distributive trades;
the organisation of trade fairs; car rental; and travel
agencies. Consumer services are also covered, such as
those in the field of tourism, including tour guides;
leisure services, sports centres and amusement park.
  2006/123/EC Directive on services in the internal
  market
•The Directive requires the Member States to examine and, if
need be, simplify the procedures and formalities applicable
to accessing a service activity and to exercise them. In
particular, the Directive includes: putting in place points of
single contact at which a provider may complete all the
necessary formalities to fulfil various duties and the
obligation to make this possible on-line.
•In order to facilitate the establishment and free movement
of services throughout the European Union, the Directive:
- lays down a legal obligation requiring the Member States to
cooperate with the relevant authorities of other Member
States in order to ensure efficient control of service activities
in the Union while avoiding a multiplication of monitoring.
- constitutes the basis for developing an electronic system for
the exchange of information between Member States, which
is vital for establishing effective administrative cooperation
between them.
  2006/123/EC Directive on services in the internal
  market
                 Main important provisions
Definitions
- „Service" means any self-employed economic activity,
    normally provided for remuneration
- "Member State of establishment" means the Member State
    in whose territory the provider of the service concerned is
    established
- "Member State where the service is provided" means the
    Member State where the service is supplied by a provider
    established in another Member State

Possibilities for providing services:
I. By establishment
II. Cross-border services (movement of services)
2006/123/EC Directive on services in the internal
market
 I. Freedom of establishment for providers
 Member States shall not make access to a service activity or
 the exercise thereof subject to an authorisation scheme
 unless the following conditions are satisfied:
 (a) the authorisation scheme does not discriminate against
 the provider in question;
 (b) the need for an authorisation scheme is justified by an
 overriding reason relating to the public interest;
 (c) the objective pursued cannot be attained by means of a
 less restrictive measure, in particular because a former
 inspection would take place too late to be genuinely
 effective.
2006/123/EC Directive on services in the internal
market
II. Free movement of services
• Member States shall respect the right of providers to provide
services in a Member State other than that in which they are
established.
• The Member State in which the service is provided shall ensure
free access to and free exercise of a service activity within its
territory. Member States shall not make access to or exercise of a
service activity in their territory subject to compliance with any
requirements which do not respect the following principles:
(a) non-discrimination: the requirement may be neither directly
nor indirectly discriminatory with regard to nationality or, in the
case of legal persons, with regard to the Member State in which
they are established;
(b) necessity: the requirement must be justified for reasons of
public policy, public security, public health or the protection of
the environment;
(c) proportionality: the requirement must be suitable for attaining
the objective pursued, and must not go beyond what is necessary
to attain that objective.
  Problems of the national implementation regarding
  tourism services – travel activities
Hungary’s implementation:
- Maintain pre-authorization (licence) for travel actvities in
case of establishment (public interest: consumer protection,
financial security concerning 90/314/ECC)
- Notification in case of cross-border services – not a pre-
condition (DANGER!)
Difficulties in implementation in lack of common
interpretation at Community level
•Free movement of services: cross-border providers –
problems with Member States’ different professional
requirements and systems (eg. requirements for travel
agencies, inspection of existing different financial guarantee
systems)
•What is establishment? (eg. infrastructre, time condition…)
•Internet selling!
  Hungarian implementation process
General implementation process (general rules)
    Act on services adopted by the Parliament June, 2009:
    general legal framework on services, definitions,
    authorization schemes, proceedings etc.
    Act on administration procedures amended by the Parliament
    June, 2009- simplification in proceedings, customer interests,
    electronic ways etc.
    Acts on modification of the effected legal acts and regulations
    (according to the screening) – by Parliament, by Government,
    by Ministers (till the end of December 2009) – TOTAL NEW
    SYSTEM for authorities and stakeholders
    Cross border service: pursue service activity without
    establishment, on temporary or casual basis
    Establishment: pursue economic activity permanently and
    constantly setting up business establishment, branch or store
    etc. – authorities must evaluate case by case (quite difficult in
    implementation, uncertain situations)
  Proposal for a new Directive on consumer rights

Under negotiation – Commission’s proposal, Council debate
(latest full version, July, 2009)
• Incorporates 4 Directives in force: on doorstep selling, distance
selling, unfair terms and sales of goods – horizontal level
• Contains provisions on common definitions, pre-contractual
information, consumer information and right of withdrawal in
distance and off-premises contacts, unfair contract terms
• The Directive will apply to sales and service contracts
concluded between the trader and the consumer
• Full harmonisation: will considerably increase legal certainty
for both consumers and business. Both consumers and business
will be able to rely on a single regulatory framework based on
clearly defined legal concepts regulating certain aspects of
business-to-consumer contracts across the Community. Member
States may not maintain or introduce, in their national law,
provisions diverging from those laid down in this Directive,
including more or less stringent provisions to ensure a different
level of consumer protection.
Proposal for a new Directive on consumer rights
Chapter II Consumer information
• The Package Travel Directive regulates in detail and
  comprehensively information of consumers before, at or after
  the conclusion of the contract. Therefore this Chapter will be
  not applicable for travel contract.

Chapter III Distance and off-premises contracts (withdrawal
   right)
A right of withdrawal is not appropriate for package travel
   contracts because:
• Difficult to be kept on hold or resold after withdrawal;
• Not easy to reconcile with supplier’s conditions of contract;
• Impossible to manage last minute bookings;
• Could jeopardy the activity of mobile travel agents;
• Creates distortions of competition with transport services
   contract, to which no right of withdrawal applies.
In the first version for distance contracts this Chapter was
   applicable for travel services as well, but after protestation of
   ECTAA and Member States this Chapter will be not applicable.
Proposal for a new Directive on consumer rights
Chapter V Consumer rights concerning contract terms
• The Chapter will apply to contract terms drafted in advance by
   the trader or a third party, which the consumer agreed to
   without having the possibility of influencing their content, in
   particular where such contract terms are part of a pre-
   formulated standard contract (unfair terms).
• According to ECTAA opinion this Chapter also should not be
   applicable to package travel contracts because, due to the
   uncertainty concerning the content of the revised Package
   Travel Directive eg.:
- inclusion of terms in package travel contracts requiring a
   minimum number of participants for the performance of the
   contract could be a problem.
- organiser would have to grant a right of withdrawal when
   revising the price after the conclusion of the contract.
Package Directive…

 STILL NO DEVELOPMENT ON THE
 REVISION of the 90/314/ECC Package
 Directive…
 New information from the Commission:
 revision will continue only after the
 adoption of the new Directive on consumer
 rights (problem 2-3 years more???)
 2010-11 Presidency of Spain, Belgium,
 Hungary political aim: force for revision,
 important issues eg. consumer interests,
 awareness consumers etc.
  Hungarian implementation process
1. New Act on travel activities (tour operator and travel agency
    activity) – under negotiations
    Following the aims of Service Directive and new Hungarian
    Service Act
    Definitions, main purposes of the activities, technical and
    personal requirements of the activity, registration procedure,
    administrative requirements, financial security (bank
    guarantee, insurance, deposit), inspections, sanctions
    (cancellation from the register, fine)
    Screening results:
- maintain pre-registration for travel companies in case of
    establishment
- notification in case of cross-border services
- competences of authority
- simplification of procedures
- electronic administration
Big debate with stakeholders at the moment on the system of the
    financial guarantee (Government aim is to increase minimum
    sums after certain bankruptcies recently)
Hungarian implementation process
Government Decree on Travel Contracts and Travel
  Agency Contracts (281/2008.)
  Latest revision of the Decree in 2008: 2005/29/EC
  Directive concerning unfair business-to-consumer
  commercial practices in the internal market ; more
  adequate implementation of the Package Travel
  Directive; Working Group of revision; still problems
  at EU level!
  Dynamic Packaging: as EU Commission has not
  made a final proposal for the revision of 90/314/EEC
  Directive yet, we did not amend the scope of the legal
  act, applying only to ‘travel package’ definition (and
  one-element service) – due to competition issues
  Package definition is connected with financial
  security (activity rules)
Hungarian implementation process
 Serious problems since economic crisis: travel
 companies are also in a difficult situation, many of
 them are on the brink of insolvency.
 Travel agencies are not obliged to have financial
 guarantee, travel contract is concluded by the TOUR
 OPERATOR and the TRAVELLER, agency as
 intermediate – less responsability
 Problem: agencies do not want to make avaliable the
 price to the tour operatpr, concluding contract
 without pre-authorization of the tour operator
 etc…”Traveller has a contract in hand and paid the
 money for the trip.”
 Association of the Hungarian Travel Organizations:
 proposal for financial guarentee as 1st step for travel
 agencies as well.
 Hungarian legislation overview
2. Tour guide services: new Minister Decree will be adopted
    Implementation of 2005/36/EC Directive on the recognition of
    professional qualifications (deadline 2008 September)
    List of historical monuments - European Commission Internal
    Market DG’s opinion: on the basis of the professional
    qualifications directive 2005/36/EC, Member States will no
    longer be able to require additional qualifications from a tourist
    guide from another Member State (in case of temporary
    provision of services) and will thus no longer be able to require
    that he obtains a special licence/proves a special training,
    including for guides for specific monuments. The former ECJ
    case law was based on the former directive on recognition of
    professional qualifications (89/48) which has been repealed by
    the new directive 2005/36 which sets up a new regime for the
    cross border provision of services. On this basis, it seems no
    longer necessary to establish a list nor guidelines for any
    selection.
    Recognition of other EU Member States’ professional
    qualification in case of cross-border services – pre-notification
    once a year at the competent authority (problem: no information
    at EU level about national competent authorities)
Hungarian legislation overview

3. Accomodation services: new legal act adopted by
   the Government
   New license will be introduced: accomodation-
   licence for the establishments (different authorities
   are involved, but only one procedure to the client)
   Authorization is connected with the establishment
   not with the activity and the service provider
   New standardization proceeding: involving civil
   organizations – trade mark system owned by the
   Ministry, not obligatory
Conclusions – doubts…
 Serious changes at the travel market of the EU27
 Distortion at the market because of the non-full
 harmonization and different implementation at
 national level legislation – examination of different
 systems (economic and legal decisions of the
 enterprises)
 Shifting business acvtivities to EU Members where
 less strict rules will be in force or non-
 registration???
 In case of insolvency: EU citizenship vs. National
 citizenship – finally Member State must be
 involved transporting their citizens back to home
 (even tour operator was not registered there)
Thank you for your kind
      attention!

          Dr Dorottya Gyenizse
     Ministry of Local Government
           Tourism Department
                 Hungary
  E-mail: gyenizse.dorottya@otm.gov.hu
          dgyenizse@gmail.com

				
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