Dominik Hanf

The Services Directive: Trojan Horse or White Knight?

Abstract The European Union’s internal market has been at the heart of the integration process since the Treaty of Rome. The 2004 Services draft Directive (known as the Bolkestein proposal) launched an avalanche of protest despite substantial purported economic gains. A proper appreciation of the Services Directive requires a tri‐disciplinary approach, which we intend to provide. It became a lightning rod for criticism and a rallying cry for those opposing further market integration, social dumping and the extension of the Anglo‐Saxon social model. The directive purportedly served as a Trojan horse for increased liberalism in the eyes of opponents, whereas supporters saw it more akin to a white knight that would rescue Europe from its inflexible labour market. Indeed, the Services Directive (both the 2004 Bolkestein draft and the adopted directive 2006/123) is misunderstood in that it is both bolder and more timid than its critics and proponents, respectively, would have one believe. We show that the development of the Services Directive can be understood far better when economic, legal and political science analysis is employed together, in particular, for the meaning, scope and timing of both versions. Services remain a key sector of economic growth for the EU and the directive is likely to have important implications economically, legally and politically, possibly with long‐term effects on EU integration.