The Internal Market

Abstract

INTRODUCTION This chapter provides an overview of what the internal market is, and the current debates about what it should be. It provides background and context to the chapters on free movement which follow. The chapter is organised as follows. Section 2 sets out the purposes of the internal market. Primarily, the internal market aims to integrate the national markets of the Member States into a single European market. It does this by removing regulatory barriers to trade between states. The reasons for pursing this project are partly economic, but also social and political: for some, the market entrenches a form of individualism (ordoliberalism) that has strong roots in continental European philosophy, while for others, its main benefit is that it sucks Member States into deeper integration in other areas. More recently, it has come to be seen by many as a regulatory project, balancing social and economic interests. Section 3 considers the legal tools used to build the internal market and the concepts underlying them. As well as free trade, a central idea in the internal market is that of ‘undistorted competition’. If states have different rules on matters relevant to industry (for example, environmental or labour law), then companies in states with low regulatory burdens will have an advantage. This may be economically problematic, but is also seen as unfair. Harmonisation often aims to remove such distortions.