Slovenian Concerns Over EU Cross-Border Services Law

By , 26 Nov 2019, 12:25 PM Business
Slovenian Concerns Over EU Cross-Border Services Law pxhere CC-by-0

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STA, 25 November 2019 - Businesses from north-east Slovenia are worried that companies providing cross-border services in the EU could be severely affected if Slovenia introduces into its law the new directive governing cross-border services and posted workers "too rigorously". A study by an economist was presented to corroborate their view.

Earlier this year, the European Federation of Building and Woodworkers (EFBWW) asked the European Commission to investigate Slovenia for dumping in temporarily posting workers in other EU countries.

The EFBWW maintains Slovenia's law enables paying lower contributions and taxes for posted workers in the markets where they work, making them more competitive, explained the head of the Štajerska region's association of providers of cross-border services, Albert Kekec.

Related - Temporary Posting of Slovene Workers “Exports Cheap Labour” (Feature)

Slovenian companies believe these are false allegations, and have complained against them, waiting for the final decision, Kekec noted in Maribor on Monday.

He believes Slovenia was challenged because it is a small country and because it has a poor record of defending itself in such cases.

But since the dispute could result in case law which would also apply to other EU countries, it is important that our country realises the weight of the case and acts appropriately, he said.

This is why the regional Štajerska Chamber of Commerce has commissioned a study of exports of construction and engineering services, and posted workers.

Economist Jože P. Damijan, presenting his study, said legislative changes would considerably lower or entirely stop the export of construction, engineering and transport services by Slovenian companies to the EU.

This is particularly true for the part of Štajerska along the Drava river, which has an above-average number of such companies.

Damijan predicts a loss of more than 10,000 jobs around the entire country, and even up to 13,000 in the worst-case scenario, of which some 5,000 in the Drava area.

The chamber wonders whether the government is aware of all the consequences that could result from transposing the directive indiscriminately.

It points to direct and indirect impact on the country's GDP, while the area around the river Drava would be affected the most.

Damijan's study shows Slovenia's construction, engineering and transport companies generate around 20% of all exported services, and almost 4.5% of the country's overall exports. The majority or 80% is exported to the EU.

These companies employ more than 70,000 workers and post around 12,000 workers abroad monthly. Slovenia is thus preceded only by Poland.

Over the past few years Slovenia's services sector has been growing the fastest in the EU.

Damijan said it was true the three sectors employed over 70% of foreign workers, mostly from the Balkans, but noted these were still Slovenian-owned companies paying taxes in Slovenia.

The chamber also criticised the government for not providing enough information, including about the appeal against the EFBWW's request to investigate Slovenia.

State Secretary at the Labour Ministry Tilen Božič has recently said the ministry intends to tackle the issue of posted workers, including alleged violations of worker rights as highlighted by Slovenian trade unions, by changing the law on cross-border services "in a foreseeable future".

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