Europe's businesses are concerned that proposed emergency market rules would be an intrusive over-reach from the European Union, which is looking to secure critical supply chains amid the worsening energy crisis.
The European Commission proposed on Monday a Single Market Emergency Instrument (SMEI)-a crisis governance framework that aims to preserve the free movement of goods, services, and persons and the availability of essential goods and services in the event of future emergencies.
The proposed instrument will allow "last-resort measures in an emergency," which means that "the Commission may issue targeted information requests to economic operators, which can be made binding."
The Commission may also ask businesses to accept priority-rated orders for crisis-relevant products, in response to which firms must either comply or explain the grave reasons justifying refusal.
The proposals will now be discussed by the European Parliament and Council of the European Union.
Businesses are concerned that the proposed instrument could intervene with the free market and look like a "planned economy" measure.
"We still need to ensure that the Single Market Emergency Instrument #SMEI is a helping hand for businesses to navigate crises, not a planned economy fist as some SMEI provisions look like," BusinessEurope, the biggest organization representing European companies of all sizes and all sectors, said on Monday after the Commission unveiled its proposal.
Separately, several European industry associations said that last week's proposals from the Commission to reduce soaring energy prices and help households and businesses through the crisis were not enough.
The Commission plans to propose a revenue cap for companies producing electricity at a low cost and a "crisis contribution" from the extra profits of fossil fuel companies in a plan to raise $140 billion (140 billion euros) to cushion the energy crisis blow to European citizens and economy.
"These measures are not enough and will not save the energy-intensive aluminium industry from further production cuts, job losses, and possibly a complete breakdown," European Aluminium, the association of the aluminum industry in Europe, said.
By Josh Owens for Oilprice.com
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Josh Owens is the Content Director at Oilprice.com. An International Relations and Politics graduate from the University of Edinburgh, Josh specialized in Middle East and… More