Business has accused Brussels of systematically failing to crack down on abuses of the EU’s single market, piling on costs for companies and stifling growth.

Industry groups including Europen, which represents the packaging industry, and EuroCommerce, the retailers’ body, have become increasingly vocal over the European Commission’s lack of action in policing common rules across Europe.

There are particular concerns over Brussels being slow to act against member states including Spain, Italy and France for enacting national laws that disrupt EU-wide supply chains and production lines.

Action taken against internal market infringements has dropped sharply since 2020, according to commission figures.

Francesca Stevens, secretary-general of Europen, said the commission was failing to address “a proliferation of new trade barriers created by member states” that were preventing the free movement of goods.

The rules of the single market stipulate that all EU member states must ensure the free movement of goods, services, labour and capital across the bloc.

“This is undermining one of Europe’s core economic strengths and investment drivers. By neglecting its role as the guardian of the [EU single market] treaty, the commission is leaving industry with little recourse but to seek enforcement of single market principles through national courts,” she said.

Improving the single market is the key goal of commission president Ursula von der Leyen, in order to reboot the EU’s flagging economy and compete with China and the US. Poland, which took over the rotating EU presidency on January 1, has made deepening the single market and removing barriers one of the priorities for its term.

On January 3, the commission opened a consultation to develop a single market strategy that it said would “help companies scale up” and promote the cross-border provision of services and movement of goods.

The strategy would “ensure the existing rules are fully implemented, to remove existing regulatory and administrative barriers and to prevent new ones”, it said.

Reports by former Italian premiers Mario Draghi and Enrico Letta last year warned that the EU risked falling behind its global peers.

In his April report, Letta noted that efforts by the commission to enforce single market rules suffered from “inadequate staffing, lack of oversight and varied procedural standards” across enforcement agencies.

But the number of overall new cases opened by the commission against member states for breaches of EU law dropped from 904 in 2020, the first year of Von der Leyen’s previous term, to 529 last year, according to the commission’s annual assessment of the enforcement of EU law in July.

There was a 60 per cent reduction in the number of infringement proceedings launched by the commission’s internal market and industry directorate in 2023, compared with 2019 — the biggest drop of any directorate, the assessment showed.

The European Court of Auditors said in a report this month that despite improvements the commission “still takes too long to close infringement cases”.

60%Reduction in the number of infringement proceedings launched by the commission in 2023

The commission said the lower number of new cases was due to more effective transposition of EU rules into national law by EU governments and fewer directives overall.

Analysis by the Financial Times has previously shown that commission action against infringement of single market rules dropped significantly under the leadership of von der Leyen.

Von der Leyen “has made the enforcement of EU law one of the commission’s top priorities”, a spokesperson said. Brussels referred 45 cases to the European Court of Justice asking for fines on member states in 2023. “This is more than in any of the last 10 years,” they said.

Early intervention to support governments in transcribing directives to national law had reduced infringements, they added.

But Europen has filed several complaints with the commission against measures introduced by member states related to packaging labelling, which the industry has said means they need to establish separate production lines for different countries.

Stevens at Europen said the measures would soon run counter to the bloc’s packaging waste regulation, which comes into force next year.

The retail industry body EuroCommerce has also raised serious concerns about the commission’s plan to revise unfair trading rules, arguing that it allows member states to unilaterally apply their national law in other EU countries.

Leena Whittaker, director for competitiveness at EuroCommerce, said companies were at liberty to choose which jurisdiction they wanted for their trading contracts but “as soon as [governments] start to say ‘my rules can apply next door’ it is just completely crumbling the single market”, she said.

“Companies choose [a specific country’s contract] law because they understand what that law means. If this happened with every law that stricter national rules could have this extra territorial effect, what is the point of having the single market?”

The European Round Table for Industry in February last year published a 268 page compendium of “single market barriers” reported by companies, which it said represented only “the tip of the iceberg”. The list ranges from difficulties posting workers in other member states to different definitions of collateral for collateralised bank loans.

In an ironic twist, the UK, which left the bloc in 2020, has delayed changes to its own packaging labelling rules after Brussels warned they would break EU law.

London is keen not to put extra burdens on companies selling across the UK and EU or costs on consumers so will await EU proposals on waste recycling before pressing ahead with its own.

“We remain committed to a mandatory labelling regime and will seek to minimise the costs and complexity for businesses, while making it easier for consumers to understand how to recycle packaging correctly and meet our environmental goals,” a UK government spokesperson said.

Jonathan Faull, former director-general for financial affairs at the European Commission, warned at an event last month that “we are going to live in an age where protectionism is fashionable again . . . the last thing we need is national protectionism in the EU.”