International service provision to international transport operations

2015-04-29

Letter to Mr. Ingo Kramer, President, Bundesvereinigung der Deutschen Arbeitgeberverbände (BDA).

Confederation Lewiatan believes that the European internal market, which includes free movement  of goods and services, is among the most important achievements and advantages of the European Union. Thanks to these freedoms enterprises obtain better access to goods and services providers from all of the EU. That guarantees high quality for reasonable cost and positively stimulates healthy competition, which is beneficial for national as well as European economies.

Export of services has strategic importance to Polish economy, as does exporting wine for France or flowers for the Netherlands. Polish services are one of the main competitive advantages our country has on the European market.

Polish service companies have rapidly grown to be a leader in cross-border provision of services in Europe. About 1,2 million delegated employees are estimated to work in the whole EU, of which at least 250,000 are posted by Polish companies. This gives Poland the first position among Member States. The second and third place are taken by France  and Germany.

In this context we are concerned about recent developments in a number of EU countries resulting in new obstacles to international service provision, specifically to international transport operations. In our opinion, such national measures will not only have a disruptive impact on the transport and other service sectors, but also on the free movement of goods and services as such. Hence we believe they are not only against the main principles of the single market, but also against sound economical rules.

Particularly with reference to the application of the Minimum Wage Act (Mindestlohngesetz) as of 1 January 2015 within the territory of the Federal Republic of Germany, we would like to express our serious concerns about the scope of application of the new regulations in relation to the international commercial transport. While we fully respect the right of Germany to introduce minimum wage legislation, in our opinion none of  domestic regulations should affect economies' of other countries. Unfortunately Mindestlohngesetz implies that a foreign transport company has to pay the German minimum wage for the time an employee, eg. truck driver, spends in Germany, also when carrying out an international transport, including in case of bilateral point to point transport, cross-border trade and transit operations. Furthermore, transport and logistics companies are obliged to inform the German Customs Authorities ahead of the transport operation by fax that they will be on German territory and for how long and keep separate records in German language of time worked in Germany.

There is a well-grounded concern that such interpretation of the new regulations will have a highly detrimental and possibly irreversible impact on the internal market, in particular on the development of the EU transport sector. As a consequence, this may lead to market segmentation, unnecessary burden on operators and undue immediate financial losses to transport companies. It may also create an incentive for other Member States to impose similar regulations in order to protect local markets.

In addition to the general negative impact on the EU internal market, the citizens and companies will also suffer direct consequences from such actions, which will increase prices of transport services and commodities.

Although we welcome the decision of the Government of the Federal Republic of Germany to suspend the application of the Minimum Wage Act to the transit operations, we should bear in mind that this Act covers also the international transport to and from the Federal Republic of Germany (goods and passengers) and cabotage. In addition, it should be noted that similar questions arise concerning other modes of transport e.g. inland navigation.

For that reason, we would like to appeal to the Bundesverband der Deutschen Industrie e.V.  and Bundesvereinigung der Deutschen Arbeitgeberverbände to make an effort to persuade the Government of Germany to reconsider the current interpretation concerning the scope of application of the Minimum Wage Act to the international transport as a whole and call for suspension of the enforcement of the new regulations also with regard to the international transport to and from the Federal Republic of Germany (goods and passengers) and cabotage, until it is fully
and indisputably clarified by the European Commission whether the admitted interpretation of those regulations complies with EU law. The above mentioned is without prejudice to the future assessment of the compatibility of the Minimum Wage Act with EU law in other areas.