EU single market
The single market ensures the free movement of goods, services, capital and people. It facilitates everyday life, stimulates growth and boosts innovation.
The EU single market: benefits, facts and figures
Established in 1993, the EU single market is one of the greatest achievements of the European Union. It guarantees that goods, services, people and capital can move freely throughout the territory of the EU: the ‘four freedoms’.
The single market allows EU citizens to live and work across the EU, providing them with better job opportunities. It offers consumers a wider choice of high-quality services and products that they can trust to be safe and respectful of the environment.
The single market stimulates trade, as it makes the EU a more important trading partner at global level. It fuels growth and competition and creates new opportunities for EU businesses, giving them access to a domestic market of 449 million consumers.
Looking towards the future, the single market is:
- key to the success of the EU’s green and digital transitions
- at the heart of the EU’s new industrial strategy
- a driver of EU competitiveness, growth and recovery from the COVID-19 crisis
EU single market programme 2021-2027
In April 2021, the Council and the European Parliament adopted the EU’s single market programme for the years 2021 to 2027.
The main objectives of the programme are to:
- increase the effectiveness of the single market
- support the competitiveness of EU businesses, in particular SMEs
- facilitate the development of effective European standards
- empower and protect consumers
- ensure a sustainable and safe food chain
- promote human, animal and plant health and support animal welfare
- establish a framework for financing high-quality statistics
The new programme consolidates into one programme a range of activities that were previously financed separately in order to manage them more efficiently. It also includes new initiatives to improve the functioning of the single market.
The programme’s total budget is €4.2 billion.
A European success story
The single market celebrated its 30th anniversary in 2023. For over three decades, the single market has been a driver of economic growth and has made people’s lives much easier.
The EU single market in figures:
- in 2021, the single market’s GDP was €14 522 billion
- 17 million EU citizens live or work in an EU country other than their own
- trade within the single market accounts for 56 million jobs
30th anniversary of the EU single market (infographic)
The single market as key to the green and digital transitions
A green single market
The single market can play a decisive role in the transition to a circular and more climate-friendly economy. The EU has taken initiatives to harness its full potential to maximise opportunities for businesses and consumers alike. With the European Green Deal, which sets the goal of making Europe the first climate-neutral continent by 2050, the EU has put in place a new framework to transform the single market.
Ecodesign for sustainable products
In May 2024, the Council adopted new ecodesign requirements for sustainable products.
The new regulation sets minimum requirements for almost all products sold on the EU market. They include:
- product durability, reusability, upgradability and reparability
- remanufacturing and recycling possibilities
- energy and resource efficiency
The regulation also includes a new ‘digital product passport’ which provides businesses and consumers with information on a product’s environmental impact.
The passport will make it easier to recycle and repair products and to track hazardous substances through the supply chain.
A digital single market
The digital single market aims to remove barriers that citizens and businesses face when using online tools and services. By removing key differences between online and offline worlds, the digital single market opens up new opportunities for businesses and creates an environment in which digital services can thrive.
With the digital services package, the Commission presented an update of the EU’s legal framework in December 2020 to keep up with digital technologies, business models and services, which have been changing at an unprecedented pace.
The package consists of the Digital Services Act (DSA) and the Digital Markets Act (DMA). The new rules aim to better govern the digital space and digital services, including social media platforms.
Digital Services Act
The Digital Services Act aims to create a safer digital space for users and companies, and to protect fundamental rights in the digital environment. The Council adopted the DSA in October 2022.
Digital Markets Act
The Digital Markets Act focuses on ensuring a level playing field for all digital companies to guarantee a competitive and fair digital sector while fostering growth and innovation. The Council adopted the DMA in July 2022.
EU industrial strategy
The European Commission presented a new industrial policy package in March 2020 that included a new industrial strategy for Europe.
Against the backdrop of the COVID-19 pandemic, the Commission updated its communication on a new EU industrial strategy in May 2021, following Council conclusions of September 2020 on how to deepen the EU single market for a strong recovery and a competitive, sustainable Europe.
The Commission reaffirmed its priorities of 2020, but presented new measures for a stronger single market, especially in times of crisis.
The updated industrial strategy focuses on:
- strengthening the resilience of the single market in the face of disruptions
- addressing technological and industrial strategic dependencies of the EU
- speeding up the digital and green transitions of the industry
Resilience of the single market
Recent crises have demonstrated the need for a well-functioning single market. Especially in light of the COVID-19 pandemic and the Russian invasion of Ukraine, the EU is working to boost its strategic autonomy to secure supply chains and reduce external dependencies.
European Council conclusions have identified the achieving of strategic autonomy while preserving an open economy as a key objective of the Union. Strategic autonomy has been defined broadly as the reduction of external dependencies in strategic areas.
The EU has taken measures to strengthen the resilience of the single market, sustain investment and support businesses.
Internal market emergency and resilience act
In September 2024, the Council adopted the internal market emergency and resilience act (IMERA).
The objective of the IMERA is to anticipate, prepare for and respond to the impact of future crises using the strength of the internal market.
Building on lessons learned from emergencies such as COVID-19, Russia’s war against Ukraine and the energy supply crisis, the new mechanism will bolster the internal market in times of crisis by:
- facilitating the movement of goods, services and persons
- monitoring supply chains
- ensuring access to critical goods
Compulsory licensing
The EU is working on new rules for a compulsory licensing applicable in the whole Union in case of crisis.
A compulsory licence is the possibility for a government to allow a third party to use a patent without the authorisation of the patent’s rights-holder.
Currently, compulsory licensing mechanisms are regulated at national level. In case of cross-border crises or emergencies this may hamper the free movement of critical products or services in the internal market or produce shortages of certain supplies in some member states.
The compulsory licensing should only be granted after the activation of an emergency or crisis mode at EU level.
The Council adopted its position on the regulation on 26 June 2024.
Monitoring the single market
Following the Council’s call to assess the resilience of the single market, the Commission published a first annual single market report in 2021, which analyses the impact of the crisis on the single market, including on the 14 industrial ecosystems. The report also includes key performance indicators to analyse economic development and monitor progress achieved.
In February 2022 the European Commission presented its second annual report on the single market. This report describes the state of the single market, focusing in particular on economic recovery after the COVID-19 crisis and identifying needs for investment that would make the single market more resilient.
The annual single market report published in January 2023 marks the 30th anniversary of the single market. It analyses the single market’s role in the current geopolitical context and describes how it improves the EU’s competitiveness and contributes to the green and digital transitions.
The 2024 report details the competitive strengths and challenges of the single market and tracks progress according to a set of key performance indicators identified in 2023 .
The role of the Council in deepening the EU single market
The European Council provides political guidance on the EU’s policies. The European Council’s new strategic agenda for the EU for 2019-2024 identifies the single market as a key asset in developing the economic base of the EU.
EU leaders also asked for a more integrated approach connecting all relevant policies and removing all remaining unjustified barriers.
The Competitiveness Council is responsible for providing strategic input from the member states’ perspective. It also monitors the implementation of proposed actions.
In the case of legislative proposals, the Council adopts legislation. In most cases the ordinary legislative procedure applies, under which the Council and the European Parliament decide as co-legislators.
The single market enforcement taskforce (SMET) provides a forum in which EU countries and the Commission can discuss how to deal with barriers that still persist on the single market. Set up in 2020, the taskforce’s objective is to facilitate the smooth running of the single market.
In May 2024, the Council called for a new strategy to strengthen the EU internal market focusing on:
- a more efficient regulatory framework adapted to the green and digital transitions and fast-changing global realities
- enhancing the four freedoms
- the use of the single market as a global standardisation power