1. CARIBBEAN
REGIONAL NEGOTIATING MACHINERY
Study on Regulatory Regimes in Selected Professional
Services in EU Member States
Final Report
August 2009
0

2. Study on Regulatory Regimes in Selected Professional Services in
EU Member States
Contract/Project No AOR 026/2009/WP2/no. 28.1-1.040
Caribbean Region
By
Noel Watson
John J. Downes
Submitted by
The Views expressed in this report do not necessarily reflect the views of the European
Commission

3. TABLE OF CONTENTS
I. Executive Summary and Recommendations .................................. 2
II. Introduction ............................................................................ 10
1. Brief Guide to the EPA ...................................................... 11
2. Mutual Recognition of Professional Qualifications in the EU .... 15
III. Methodology............................................................................ 17
1. Introduction .................................................................... 17
2. Business Environment/Market Related Issues ...................... 19
2.1. Overview of the specific domestic market for each of the selected
countries .............................................................................. 19
2.2. Trade related issues in the selected industries in the selected
countries .............................................................................. 21
2.3. General Framework for Setting up in Business or Supplying
Services ............................................................................... 21
2.4. Regulatory and Administrative Issues for the Listed Professions ......
..................................................................................... 22
IV. Opportunities for TRADE IN SERVICES ........................................ 26
1. Estonia: Opportunities for Cariforum Service Providers ......... 28
1.1. Size and structure of domestic market for each service .............. 28
1.2. Trade in Services ................................................................... 30
1.3. Steps for Establishing a Business in Estonia .............................. 34
1.4. Industry Specific Opportunities in Estonia ................................. 35
2. France: Opportunities for Cariforum Service Providers .......... 41
2.1. Size of each selected industry ................................................. 42
2.2. Trade in Services ................................................................... 43
2.3. Steps for Setting up a Business in France ................................. 48
2.4. Industry Specific Opportunities in France .................................. 49
3. Germany: Opportunities for Cariforum Service Providers....... 55
3.1. Size of each selected industry ................................................. 55
3.2. Trade in Services ................................................................... 56
3.3. Steps for Setting up a Business in Germany .............................. 60
3.4 Industry Specific Opportunities in Germany .............................. 61
4. Italy: Opportunities for Cariforum Service Providers ............. 67
4.1. Size of each selected industry ................................................. 68
4.2. Trade in Services ................................................................... 69
4.3. Steps for Setting up a Business in Italy .................................... 73
4.4 Industry Specific Opportunities in Italy .................................... 74
5. Malta: Opportunities for Cariforum Service Providers ............ 79
5.1. Size of each selected industry ................................................. 79
5.2. Trade in Services ................................................................... 80
5.3. Steps for Setting up a Business in Malta ................................... 84
5.4. Industry Specific Opportunities in Malta.................................... 85
6. Netherlands: Opportunities for Cariforum Service Providers .. 93
6.1. Size of each selected industry ................................................. 93
7

4. 6.2. Trade in Services ................................................................... 94
6.3. Steps in Setting up a Business in The Netherlands ..................... 98
6.4. Industry Specific Opportunities in the Netherlands ..................... 99
7. Spain: Opportunities for Cariforum Service Providers ......... 102
7.1. Size and structure of domestic market for each service ............ 102
7.2. Trade in Services ................................................................. 103
7.3. Steps in Setting up a Business in Spain .................................. 107
7.4. Industry Specific Opportunities in Spain ................................. 108
8. UK: Opportunities for Cariforum Service Providers ............. 113
8.1. Size of each selected industry ............................................... 113
8.2. Trade in Services ................................................................. 114
8.3. Steps in Setting Up a Business in the United Kingdom .............. 118
8.4. Industry Specific Opportunities in the U.K. .............................. 119
V. General Regulatory and Administrative Framework for Supplying
Services .................................................................................. 129
1. Estonia ......................................................................... 129
1.1. General Regulatory Environment ........................................... 129
1.2. Setting up a Business........................................................... 129
1.3. Estonian Chamber of Commerce and Industry ......................... 130
1.4. Types of Business Undertaking .............................................. 131
1.5. Foreign Enterprise Entities Operating in Estonia....................... 137
1.6. Business Accounting Principles .............................................. 137
1.7. Auditing Standards .............................................................. 138
1.8. Taxation ............................................................................. 138
1.9. Visas, Work and Residence Permits etc .................................. 141
1.10. General Restrictions Tabled by Estonia under the EPA .............. 145
2. France .......................................................................... 145
2.1. General Regulatory Environment ........................................... 145
2.2. Setting up a Business........................................................... 146
2.3. Types of Business Undertakings. ........................................... 147
2.4. Other Legal Requirements .................................................... 149
2.5. Foreign Professionals wishing to Provide Professional Services in
France ............................................................................... 150
2.6. Visas, Work and Residence Permits Etc. ................................. 151
2.7. Taxation ............................................................................. 152
2.8. E-commerce ....................................................................... 152
2.9. Contacts ............................................................................. 153
2.10. General Restrictions Tabled by France under the EPA ............... 153
3. Germany ...................................................................... 153
3.1. General Regulatory Environment ........................................... 153
3.2. Setting up a Business........................................................... 154
3.3. Types of Business Undertakings ............................................ 154
3.4. Taxation ............................................................................. 156
3.5. Business Premises Law ......................................................... 156
3.6. Employment Law Provisions .................................................. 156
3.7. Other Legal Requirements .................................................... 157
3.8. Visas, Work and Residence Permits ........................................ 158
3.9. E-commerce ....................................................................... 161
3.10. Bank Accounts .................................................................... 161
3.11. General Restrictions Tabled by Germany under the EPA............ 161
3.12. Contacts ............................................................................. 161
4. Italy ............................................................................. 163
4.1. General Regulatory Environment ........................................... 163
4.2. Setting Up in Business ......................................................... 163

5. 4.3. Types of Business Undertakings. ........................................... 163
4.4. Visas, Work and Residence Permits etc .................................. 165
4.5. Bank Accounts .................................................................... 167
4.6. Taxation ............................................................................. 167
4.7. General Restrictions Tabled by Italy under the EPA .................. 167
5. Malta. ........................................................................... 167
5.1. General Regulatory Environment ........................................... 167
5.2. Types of Business Undertaking .............................................. 167
5.3. Taxation ............................................................................. 169
5.4. Visas, Work and Residence Permits etc. ................................. 169
5.5. Accounts ............................................................................ 172
5.6. General Restrictions Tabled by Malta under the EPA ................. 172
6. Netherlands. ................................................................. 172
6.1. General Regulatory Environment ........................................... 172
6.2. Setting Up as Business ......................................................... 172
6.3. Types of Business Undertakings ............................................ 173
6.4. Recognition of Foreign Qualifications ...................................... 174
6.5. Taxation ............................................................................. 175
6.6. Visas, Work and Residence Permits Etc .................................. 176
6.7. General Restrictions Tabled by the Netherlands under the EPA ........
................................................................................... 181
7. Spain ........................................................................... 182
7.1. General Regulatory Environment ........................................... 182
7.2. Types of Business Undertakings. ........................................... 182
7.3. Setting up a Business........................................................... 183
7.4. Taxation ............................................................................. 184
7.5. Employment Issues ............................................................. 185
7.6. Business Premises ............................................................... 185
7.7. Visas and Work Permits ........................................................ 185
7.8. Bank Accounts. ................................................................... 187
7.9. General Restrictions Tabled by Spain under the EPA ................ 188
8. United Kingdom. ............................................................ 188
8.1. General Regulatory Environment ........................................... 188
8.2. Types of Business Undertakings ............................................ 189
8.3. Business Premises ............................................................... 196
8.4. Taxation ............................................................................. 197
8.5. Business Licenses ................................................................ 199
8.6. Employment Issues ............................................................. 200
8.7. Visas, Work Permits etc ........................................................ 201
8.8. Bank Accounts .................................................................... 204
8.9. General Restrictions Tabled by Spain under the EPA ................ 204
VI. Regulatory Framework for Trade IN SPECIFIC Services ............... 205
1. Introduction .................................................................. 205
2. Accountancy Services and Auditing .................................. 206
2.1. Estonia ............................................................................... 206
2.2. France ............................................................................... 209
2.3. Germany ............................................................................ 212
2.4. Italy. ................................................................................. 218
2.5. Malta ................................................................................. 222
2.6. Netherlands ........................................................................ 226
2.7. Spain ................................................................................. 230
2.8. United Kingdom .................................................................. 235
3. Architects ..................................................................... 261
3.1. Estonia ............................................................................... 261

6. 3.2. France ............................................................................... 265
3.3. Germany ............................................................................ 268
3.4. Italy. ................................................................................. 274
3.5. Malta ................................................................................. 276
3.6. Netherlands ........................................................................ 278
3.7. Spain ................................................................................. 279
3.8. United Kingdom .................................................................. 281
4. Engineers...................................................................... 285
4.1. Estonia ............................................................................... 285
4.2. France ............................................................................... 285
4.3. Germany ............................................................................ 286
4.4. Italy .................................................................................. 292
4.5. Malta ................................................................................. 295
4.6. Netherlands ........................................................................ 297
4.7. Spain ................................................................................. 298
4.8. United Kingdom .................................................................. 300
5. Management Consultants ................................................ 304
5.1. Estonia ............................................................................... 304
5.2. France ............................................................................... 305
5.3. Germany ............................................................................ 305
5.4. Italy .................................................................................. 309
5.5. Malta ................................................................................. 310
5.6. Netherlands ........................................................................ 310
5.7. Spain ................................................................................. 311
5.8. United Kingdom .................................................................. 312
6. Tourist Guide Services .................................................... 314
6.1. Introduction ........................................................................ 314
6.2. Estonia ............................................................................... 314
6.3. France ............................................................................... 315
6.4. Germany ............................................................................ 316
6.5. Italy .................................................................................. 319
6.6. Malta ................................................................................. 320
6.7. Netherlands ........................................................................ 321
6.8. Spain ................................................................................. 321
6.9. United Kingdom .................................................................. 322
7. Tour Operators .............................................................. 328
7.1. Estonia ............................................................................... 328
7.2. France ............................................................................... 331
7.3. Germany ............................................................................ 332
7.4. Italy .................................................................................. 339
7.5. Malta ................................................................................. 341
7.6. Netherlands ........................................................................ 342
7.7. Spain ................................................................................. 342
7.8. United Kingdom .................................................................. 343
VII. Appendices............................................................................ 346
1: General Considerations and Macroeconomic Comparisons ............. 346
2: Opportunities at the country level: ............................................. 353
3. General Framework for Supplying Services: ................................. 358
4. Summary of Regulatory Framework for the Professions in The 8 EU
Member States .............................................................................. 364
5: Questionnaire on the business environment ................................ 378
6. Contacts and Interviewees in EU Member States.......................... 383

7. Abbreviations and Explanations
ACP African Caribbean Pacific
Caribbean Forum of States : Antigua and Barbuda, the
Bahamas, Barbados, Belize, Dominica, the Dominican
Republic, Grenada, Guyana, Haiti, Jamaica, Saint Lucia, Saint
Cariforum
Vincent and the Grenadines, Saint Kitts and Nevis, Surinam,
and Trinidad and Tobago. Cuba is a member but was not
involved in this EPA.
CRNM Caribbean Regional Negotiating Machinery
CSS Contractual Services Suppliers
EEA European Economic Area: Iceland, Liechtenstein, Norway.
EPA Economic Partnership Agreement
European Union : Austria, Belgium, Bulgaria, Cyprus, Czech
Republic, Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Ireland, Italy, Latvia, Lithuania,
EU
Luxembourg, Malta, Netherlands, Poland, Portugal,
Romania, Slovakia, Slovenia, Spain, Sweden. United
Kingdom
IP Independent Professionals
Organisation for Economic Cooperation and Development
OECD comprises 30 countries including France, Germany, Italy,
the Netherlands, Spain and the UK.
Austria, Belgium, Czech Republic, Denmark, Estonia,
Finland, France, Germany, Greece, Hungary, Iceland, Italy,
Schengen
Latvia, Lithuania, Luxembourg, Malta, Netherlands,
Countries
Norway, Poland, Portugal, Slovakia, Slovenia, Spain,
Sweden.
UNCPC United Nations Central Product Classification
1

8. I. EXECUTIVE SUMMARY AND RECOMMENDATIONS
■ The project arises from the European Partnership Agreement (EPA)
between the EU and the Cariforum countries regarding trade relations
2008-2028.
■ Amongst the aims of the EPA are to:
Improve Cariforum countries global competitiveness.
Enable them to take advantage of key opportunities in the export
of services.
Liberalise investment and trade in services.
■ The EPA will require adjustments in EU legislation, regulations and
administrative procedures.
■ It will be necessary to develop mutual recognition procedures for
professional and other qualifications.
■ The objectives of this report are to:
Set out the opportunities that arise for certain key professions.
Provide trade data.
Outline the existing legal, regulatory and administrative framework
for these professions in 8 EU Member States.
■ The professions concerned are:
Accountancy, auditorship and book-keeping.
Architecture.
Engineering.
Management Consultancy.
Tourist Guiding.
Tour Operations.
■ In defining those professions this report uses the UNPC Classification
System.
■ The 8 EU Member States covered are: Estonia, France, Germany, Italy,
Malta, Netherlands, Spain and the United Kingdom.
■ Opportunities for trade in the selected countries are presented in the
table set out in Part VII: Appendix 2 of this report. In summary
The most open markets for Cariforum suppliers appear to be in
Estonia, Italy, Netherlands and the UK.
Less open are those in France, Germany, Malta and Spain but that
does not mean that there no opportunities in those countries as
the report indicates below.
Cariforum professionals may take the opportunities afforded by
their capacity to provide services at a lower cost, using modes 1
2

9. and 4, to markets where costs are substantially higher e.g. France,
Germany, Italy, Netherlands, Spain and the UK.
The proximity of Estonia to Scandinavia and its links with the
former Soviet countries may provide Cariforum professionals
working with Estonian counterparts with opportunities to penetrate
those larger markets.
The proximity of Malta and its linkages with North Africa likewise
provides opportunities to tap into those larger markets.
In addition to the UK, Anglophone Cariforum professionals may
find it easier to engage in business in markets where English is
widely understood such as Estonia, Germany, Malta and the
Netherlands.
Surinamese professionals have an advantage in penetrating the
Dutch market based on historical relationships, common language
and the Surinamese diaspora in the Netherlands. The same is true
for professionals from the Commonwealth countries in respect of
the UK.
■ The study finds that due to the general level of maturity of markets in
the EU, in all of the selected markets there are minimal or no
competitive edges to be gained from the following factors:
Industry competitiveness
- Nearly all industries are very competitive so very few
opportunities could be found based on monopoly or some other
market structure.
- There are a few exceptions for tour guides in niche areas or
certain geographical regions.
Quality of service
- In all industries the quality of services provided were rated as
―fairly good‖ or international standard.
Availability of service providers
- There were no industries where there was a declared shortage of
service providers, in fact, with the global recession and the use
of offshoring, the converse was usually true.
■ The main opportunities are due to the following factors:
The sheer size and income of the EU market
- This gives the relatively tiny Cariforum service providers a vast
array of opportunities to skim off minute pieces of the EU
market. This activity will have no significant impact on the EU
market but could have a relatively substantial impact on
Cariforum exports and foreign exchange earnings.
3

10. Price-related opportunities.
- Due to the fact that in all industries Cariforum prices (fees &
charges) are generally lower than those in the EU. As long as EU
users of services can verify that the quality of services provided
by Cariforum services providers is of ―international standard‖
then the price advantage should result in an increased demand.
Positive attitude towards joint ventures
- The survey found that in all of the selected industries across the
eight countries, there was a positive attitude towards joint
ventures. Joint ventures typically represent a win-win situation
that can increase earnings and minimize risks and costs for both
parties while not posing major threats to either.
■ A table setting out the general framework for Cariforum citizens wishing
to supply professional services in the 8 EU countries is set out in Part
VII: Appendix 3 of this report.
■ The report provides details on:
The system, rules and procedures governing trade under all four
modes of delivery and, where relevant, entry, residence and
setting up in business or taking up employment opportunities in
the 8 Member States.
The nature of the legal system in each of the 8 states
The rules and procedures governing the various types of business
entities, their registration and liabilities.
Any compulsory membership provisions for business entities.
Tax provisions applicable to individuals and business entities.
■ There are detailed descriptions of the regulations governing each of the
professions in each Member State set out in this report. A summary is
provided in Part VII: Appendix 4
■ Exploitation of the opportunities identified in this report will require
aggressive and proactive initiatives by:
Caribbean service providers themselves,
Association representing service providers e.g. Coalitions of Service
Providers,
Caribbean policymakers and negotiators, and
Caribbean High Commissions and Diplomatic Attaches in the
various EU countries.
4

11. ■ These players will have to engage in activities such as the following:
view the large EU market as part of their day to day opportunity set;
operate using all the modes of trading services; and exploit all of the
potential opportunities.
■ Cariforum diplomatic representatives need to pressure their EU
counterparts (e.g. at the British Home Office) to ensure that simple fast
track processes for acquiring business visas, as envisaged by the EPA,
are put in place.
■ A survey of Cariforum interest in exporting selected services to the EU
should be conducted in order to target more closely those who are
interested. It cannot be taken for granted that most Cariforum services
providers want or need to penetrate EU markets.
■ Funded service trade missions should be arranged to selected EU
Member States for serious export oriented professionals. Criteria for
seriousness should be developed such as:
A one-page outline of export history and capacity
Contribution to the cost of the mission, which is reimbursable on
presenting a report on opportunities and making at least one
presentation to an industry grouping
■ A small and efficient Regional Unit, such as the Caribbean Coalition of
Services Providers, should be supported and given a mandate to seek
export opportunities in professional services. This would include:
Searching all major global databases for Request for Proposals and
bid documents;
Circulating information to relevant national associations;
Helping to put Regional teams together;
Arranging joint ventures with EU and other non-Cariforum service
providers;
Having a constantly updated website with links to sites where bids
are advertised.
Branches of this Unit should be established/strengthened in each
Cariforum Member State.
■ A more aggressive outward looking approach by Cariforum services
providers. This may require some training or stimulus for them to think
global; remember size of the global market; use the Internet to find
sites where requests for proposals are advertised; look for partners and
pull teams together to submit large bids.
■ Cariforum service providers should aggressively look for Requests for
Proposals and bid documents and be the senior partners in putting
teams together. This approach will tend to yield to higher earnings
(including finder‘s fees) than playing the subsidiary partner.
5

12. ■ Regional services providers should be oriented to seek opportunities to
trade by all four modes. They should not be afraid of setting up a
business in the EU if it is the best way to supply the diaspora market.
However, they should be reminded that they do not have to set up in
EU to export services if they use the other three modes of supply.
■ Cariforum service providers should be encouraged to make corporate
visits to key EU organizations including EC funded organizations, private
sector associations and private sector companies to submit business
profiles, request to be put on any list that they send out to seek bidders
and enter and stay in their hearts and minds.
■ Professional associations in the Cariforum countries need to prepare for
mutual recognition of professional qualifications by:
Preparing a document setting out the qualifications required to
practice the profession and, in particular, addressing the following,
even if the answer is ―not applicable‖:
- Academic qualifications: what is needed; what are the essential
entrance requirements; what are the syllabus requirements; are
their rules governing the nature, amount and grading of
assessments; whether there are rules governing where these
qualifications are acquired; rules governing how long or how
many attempts may be made to acquire these qualifications.
- Professional experience: is this a pre- or post-qualification
requirement; what type of experience is needed; where must it
be acquired; who, if anyone, is qualified to supervise the
experience; how is the experience tested or reviewed; what is its
duration; can it be part-time or interrupted for time off.
- Professional associations: is membership compulsory; are their
categories of membership; are there services which can only be
legally provided by a member of that association; are there
services which members are prohibited from providing; is there
corporate membership and if so are there rules governing it (e.g.
more than 50% of the shares or control of the company must be
in the hands of chartered accountants); is there a disciplinary
system; is there a system of quality assurance/peer review; is
the association linked with others abroad.
- Professional cards, certificates, diplomas etc.: are there rules
requiring a professional to carry, hold, display a card, badge,
certificate, diploma etc.; is there a system of practising
certificates; how might these be suspended or revoked.
- Negotiations: associations should elect a negotiating team.
Preferably it should include a person with international
experience and a person with academic training experience.
6

13. - Contact points for recognition procedures: an administrator(s)
that may be contacted by individual professionals enquiring
whether their qualifications are recognised in an EU Member
State and who also might be contacted by a person qualified in
the EU and is seeking recognition of their qualification in the
Cariforum country.
- Lifelong learning provisions: whether there are continuing
professional development requirements.
- The effects of recognition of foreign qualifications in the
Cariforum country: whether the person whose qualification is
recognised is required to undertake a professional examination
(e.g. a foreign accountant might be required to take a course in
Trinidadian and Tobago Business Law and Taxation) or other
requirement; are there restrictions on what they might and
might not do.
- Fees: are the fees that may be charged regulated by law/ by the
professional association; can a client challenge the fees charged
and, if so, how; are their rules governing anti-competitive
practices and unfair trading.
- Complaints procedures: is there a system in the
country/provided by the association for dealing with complaints
against a member; do foreign clients resident within/outside of
the jurisdiction have access to this system.
- Exemptions: are there exemptions granted to any of the
professional requirements.
- Use of professional titles: are these protected in law.
Preparing a gap analysis between the professional requirements in
the Cariforum country and those of the EU Member States.
Identify best practice that already exists between professional
associations in the Cariforum countries and those in EU Member
States.
Give consideration to harmonising professional qualifications in the
Cariforum states in order to strengthen their bargaining power in
negotiating with EU counterparts.
Conduct a review of the existing qualifications and training
requirements with a view to matching international best practice
and harmonisation with that in the EU states.
■ Tour operators, travel agents, destination management companies,
ground handlers, tourist transportation providers, tourist
accommodation providers, tourist guides and other tourist service
7

14. providers should form professional associations on a Cariforum wide
basis and have an umbrella organisation to promote their common
interests.
■ There is a need for the Cariforum countries to take advantage of the
assistance provided under the EPA to develop strong and efficient
institutional and regulatory frameworks for tourism. These should
replace out of date laws and regulations that tend to solely focus on
industry regulation. There is a need to develop a modern legal
framework that enshrines the principles of sustainability in the law
itself; that promotes tourism development; that facilitates investment;
encourages and facilitates SMEs to take advantage of niche markets;
that ensures that tourism resources are identified, classified, protected,
enhanced and utilised sustainably; that furthers the Millennium
Development Goals through tourism development.
■ The tourism sector needs to find support for developing direct sell-
mechanisms to the EU market through e-commerce. They will require
to build consumer confidence in the EU by harmonising legal provisions
in the Cariforum countries with those in the EU dealing with package
travel; ―unpackaged travel‖; distance selling; e-commerce (e.g.
electronic signatures); credit cards; data protection; financial
insolvency. This is more achievable on a Cariforum-wide basis than in
individual countries. Many countries outside of the EU have harmonised
with these provisions.
■ Professional and trade associations need to be improved and become
more outward-looking. They should not merely be accreditation bodies
or professional guilds but should provide members with business
services. Business associations play a major role in economic change.
Thus, they need to be strengthened in the Cariforum countries by a
review of their operations, identification of best practice, a gap analysis
and a plan for implementing change. Specialized training programmes
for the professional associations should be developed. A Professional
Associations Executive Management course should be developed.
Strategic and business plans should be produced for each association.
Associations might share some common administrative and business
facilities. New methods of consultation with members and meetings
should be developed to ensure active participation e.g. through virtual
meetings, association websites, professional blogs etc.
■ Languages: The lack of sufficient foreign language skills, particularly in
the Anglophone countries means that it may be difficult for
professionals from those countries to fully avail themselves of the
opportunities afforded in continental Europe by this EPA. A review of
language teaching in schools needs to be undertaken, particularly in
Anglophone countries. Universities and colleges should devise intensive
business language and culture courses for undergraduates on
vocational courses and for qualified professionals.
8

15. ■ Hidden cultural barriers: it is important to understand the cultural
norms, business ethos and the nuances of inter-personal dealings in the
business community of the host country in order to successfully
network and obtain business there. Familiarisation events might be put
on for business professionals in cooperation with foreign embassies,
consulates and cultural associations.
■ Access, Distance and Costs: obtaining visas, long-distance travel and
the costs of transport and accommodation may be prohibitive for many
SMEs. There is a need for cooperation to share costs to send fact-
finding and networking groups to the EU. Support funding might be
sought together with sponsorship arrangements with airlines, tour
operators and hotel chains.
■ Protectionism: though outwardly open to business, EU counterparts
may in practice rely on well-established networks and contractual
partners and may be reluctant to welcome Cariforum competitors. The
EPA sets out commitments of EU Member States and a system for
complaints and dispute settlement.
■ Difficulty of obtaining and disseminating information: it is difficult for
SMEs to obtain up to date information on business opportunities in the
EU. Also, those that do obtain such information are not always efficient
in disseminating it. In many countries Business Schools gather, assess,
review and disseminate this information to businesses and
professionals, often for a small charge. Arrangements should be made
between professional associations and the higher educational
institutions to cooperate on these matters. This may be a mutual
benefit/no cost arrangement, a commercial one, one sponsored from
public or private funds or a combination thereof.
■ Where EU regulations require a professional to have professional
indemnity insurance the costs may prove prohibitive for the Cariforum
professional. However, for the most part, they type of contractual
agreement that the Cariforum professional will have with an EU
counterpart will require the latter to have professional liability insurance
not the former. Where it is a requirement, Cariforum professional
associations should cooperate to seek a common policy. This will
strengthen their negotiating power with the relevant financial
institutions. The latter will lower premiums for members of well-run,
properly policed and quality assured professional associations.
■ The cost of exchange transactions is very expensive. Title 3 deals with
current payments and capital movement. The aim is to ease the
process through which payments for commercial transactions can be
made and the process by which capital related to investment is moved
between the two sides.
■ There needs to be greater cooperation on a regional level both at the
professional level and the state level. Regional and international
regulatory harmonisation is taking place elsewhere in order to facilitate
trade and competitiveness. The Cariforum countries need to address
this.
9

16. II. INTRODUCTION
This project arises from the Economic Partnership Agreement (EPA)
between the Caribbean ACP (Cariforum) and the EU governing trade
relations 2008-2028. A key aim of that agreement is to improve the
Cariforum countries‘ global competitiveness and promote export
diversification. It is expected that the main gain will be in services as these
countries already have market access for their goods. The World Bank has
observed that the key opportunities for market growth in the Cariforum
countries are in the export of services.
Title II of the EPA provides arrangements for a progressive two-way
liberalisation of investment and trade in services. It is acknowledged that
this will require adjustments to legislation, regulations and administrative
provisions in the EU. Article 82 para. 2 provides:
“the Parties shall encourage the relevant professional bodies in the
respective territories to jointly develop and provide
recommendations on mutual recognition to the Cariforum/EU Trade
and Development Committee…for the authorisation, licensing,
operation and certification of investors and service suppliers and, in
particular, in the professional services sector”.
Thus, it is envisaged that there will be subsidiary agreements on mutual
recognition.
In addition to helping professional associations to prepare for mutual
recognition negotiations with EU counterpart associations under Articles 82
and 85 of the EPA, this report will provide information on the regulatory
frameworks and provide market intelligence to assist small and medium
professional services businesses on supplying services in 8 EU Member
States.
The objective of this report is to set out the opportunities that arise from
this Agreement; to provide trade data; and outline the regulatory
framework for providing selected professional services in 8 Member States
of the EU and to assist the Cariforum countries and the relevant
professional associations within them in making the necessary adjustments
and informing negotiations so as to maximize the benefits envisaged by
the EPA.
10

17. 1. Brief Guide to the EPA
The parties negotiated provisions on market access, mutual recognition
and cooperation in the provision of professional services. The UN Central
Product Classification System was used for the purposes of this
negotiation. The negotiations focussed on, amongst other things, the
removal of barriers to providing services in respect of;
■ Market access.
■ National treatment: the extent to which foreign service suppliers are
treated like domestic service suppliers.
There are also provisions on cooperation and mutual recognition of
qualifications in respect of professional services and technical assistance
for the tourism sector.1
There are provisions in the EPA to facilitate trade in services by making it
easier for Cariforum nationals to visit EU Member States for brief periods
for business purposes. Those purposes must relate to research and design,
marketing, training, trade fairs, sales, purchasing and tourism. However,
this does not compel EU Member States to issue any Cariforum national
with a visa.
Article 60(5) expressly provides that Member States can retain or amend
their rules governing, for example, visas, residence permits and work
permits ―….provided that such measures are not applied in such a manner
as to nullify or impair the benefits accruing to any Party under the terms of
a specific commitment‖.
Each state is entitled to retain its domestic regulations governing the
professions in respect of such matters as qualifications, certification,
registration and licensing etc.
The EPA deals with the standard 4 modes of trade in services:
■ Mode 1: Cross-Border Supply
Services flow from the territory of one Member State to that of another
e.g. by internet, telephone or other telecommunications. The
commitments given in this regard are rather conservative. Auditing
services are limited in 21 states and architecture in 13.
1
The authors are greatful to CRNM for their briefing guides and, in particular, CRNM’s “Brief
Treatment of Professional Services in the WPA”, 3200 3/EPA-8(08).
11

18. ■ Mode 2: Consumption Abroad
The consumer moves into another Member‘s territory to obtain
services. The commitments for this mode of delivery are more liberal
than those given in respect of mode 1. Most countries made no
reservations in respect of this mode of delivery.
■ Mode 3: Commercial Presence
A service supplier from one Member State establishes a territorial
presence in another Member State, including through ownership or
lease of premises there, in order to provide a service. The system is
based on reservations rather than permissions i.e. if the EU Member
State has not stated a reservation or limitation in the List of
Commitments on Commercial Presence; it is presumed that there is
none other than the usual restrictions in relation to visas etc.
There are some limitations in respect of certain professional services
and these are indicated below in the relevant parts of this report. Of
those relevant to this study are those in respect of accountancy,
auditing and book-keeping.
■ Mode 4: Presence of Natural Persons
Persons from one state enter the territory of another in order to
provide a service. This enables the temporary entry and stay of key
personnel and graduate trainees for periods of up to 3 years for intra-
corporate transfers: 90 days in any 12 month period for business
persons; 12 months for graduate trainees (Article 82). Article 84
requires Member States to endeavour to facilitate the entry and stay of
short term visitors for business purposes.
Article 60(1) makes plain that the EPA does not affect measures in respect
of citizenship, residence or employment on a permanent basis. Member
States are entitled to maintain or adopt measures regulating temporary
stays in their territory, for example, provided that these ―…are not applied
in such a manner as to nullify or impair the benefits accruing to any Party
under the terms of a specific commitment‖.
Chapter 4 deals with the temporary presence of natural persons for
business purposes. Article 80(1) provides that this covers:
■ Key personnel – business visitors responsible for setting up a
commercial presence and those involved in intra-corporate transfers;
■ Graduate trainees;
■ Business services sellers;
■ Short term visitors for business purposes;
■ Contract services suppliers (CSS) ;
■ Independent professionals (IP).
12

19. Those entering for business purposes do so in order to:
■ Engage in research and design.
■ Undertake marketing research.
■ Attend or provide training seminars.
■ Attend trade fairs and exhibitions.
■ Negotiation of sales of services.
■ Negotiation of the purchase of services.
■ Tourism personnel visiting to make arrangements for tours.
Those visiting for business purposes cannot sell services directly to the
general public whilst in the Member State or acquire remuneration for the
provision of services during their visit.
The following table sums up the general provisions on entry requirements
under the 4 modes. It is important, however, to look at the detailed
provisions for each country set out in Section V.
Road Map for Entry into the EU - Entry Requirements for Different Modes
and Categories
Mode Entry requirements Relevant requirements
Mode 1 Not relevant because Ability to meet required
there is no movement standards
of natural persons
Mode 2 Not relevant because Qualifications and ability
the service provider to meet required
does not move standards (of the local
market)
Mode 3 Visa, residence Establishment of
permit and work company or other
permit business entity.
Taxation compliance, etc
Mode 4
 Contract Service Business Visa Proof that the person is
Suppliers entering only for
―business purposes‖ e.g.
market research,
seminars, fairs,
exhibitions, negotiate
sales etc.
13

20.  Independent Business Visa Proof of membership of
Professional profession/qualification.
Proof that the person is
entering only for
―business purposes‖ e.g.
market research,
seminars, fairs,
exhibitions, negotiate
sales etc.
 Intra-corporate Business Visa, Proof of membership of
transferees residence permit and company; reason for
work permit transfer; remuneration
and subsistence
provisions; undertaking
to return on completion
of period.
Independent/self-employed professionals have access to the EU in respect
of 11 sectors including:
■ Accounting and book-keeping services.
■ Taxation advisory services.
■ Architectural services.
■ Urban planning and landscape architectural services.
■ Engineering.
■ Integrated engineering.
EU Member States may still apply Economic Needs Tests (ENTS) but there
are no restrictions on the number of service suppliers that may enter a
market.
Currently, EC Directives on Mutual Recognition of Professional
Qualifications only apply to EU nationals. The EPA provides for negotiations
between professional associations from the Cariforum and EU states on the
development of mutual recognition agreements. These will then be
submitted to the Joint Committee established under the EPA in order to
assess the agreements‘ compatibility with the provisions of the EPA and
World Trade Organization commitments.
Article 24 of the Cotonou Agreement provides for cooperation in the field of
tourism and for the liberalisation of tourism services. The Tourism Section
of the EPA safeguards the interests of SMEs in the tourism sector in the
Cariforum countries. It does so by an article on the prevention of anti-
competitive practices through tourism distribution networks. Provision is
made for consultation and dialogue through the Cariforum-EC Trade and
Development Committee. In addition to provisions for assistance and
14

21. training to the service suppliers and support for training institutions, there
are also provisions for mutual recognition of qualifications in the tourism
sector.
Title 2 of the EPA contains provisions for the development of common rules
for e-commerce e.g. on electronic signatures and consumer protection.
Title 3 deals with current payments and capital movement. The aim is to
ease the process through which payments for commercial transactions can
be made and the process by which capital related to investment is moved
between the two sides.
2. Mutual Recognition of Professional Qualifications in the EU
European Union citizens have a right to establish themselves and/or their
business and to provide services anywhere in the EU. These are
fundamental freedoms established under the Single Market. There are EU
rules guaranteeing mutual recognition of professional qualifications (MRQs)
between Member States. These cover, amongst other things:
■ Harmonisation of training requirements in specific sectors which give
automatic recognition of professional qualifications. These are mainly to
be found in the health professions.
■ Mutual recognition which applies to all professions for which Member
States require a qualification (―the general system‖), with the exception
of the specific sectors mentioned above.
■ Coordination of the laws of Member States on self-employment,
commercial agents, harmonising the civil law on the relationship
between agent and principal.
The EU system was recently reformed to:
■ Make labour markets more flexible.
■ Further liberalise the provision of services.
■ Encourage more automatic recognition of professional qualifications.
■ Simplify administrative procedures.
Directive 2005/36/EC consolidates and modernises 15 existing directives
covering the whole range of MRQs except those relating to lawyers,
commercial agents and activities relating to toxic substances. The 20
October 2007 was the end of the transposition period. The preamble to this
Directive on the Recognition of Professional qualifications states:
■ “(4)…there should be specific rules aimed at extending the possibility of
pursuing professional activities under the original professional title”.
■ “(8)…The services provided should be subject to the application of the
disciplinary rules of the host Member State having a direct and specific
link with the professional qualifications, such as the definition of the
profession; the scope of activities covered by a profession or reserved
to it; the use of titles; and serious professional malpractice which is
specifically linked to consumer protection and safety”.
15

22. ■ “(10)…The Directive does not create an obstacle to the possibility of
Member States recognising, in accordance with their rules, the
professional qualifications acquired outside the territory of the European
Union by third country nationals. All recognition should respect in any
case minimum training conditions for certain professions. “.
The Directive contains provisions on the following, amongst other things:
■ Professional experience.
■ Professional associations.
■ Professional cards, certificates, diplomas, etc.
■ Contact points for recognition procedures.
■ Lifelong learning provisions.
■ The effects of recognition.
■ The principles of free provision of professional services.
■ Exemptions.
■ Administrative cooperation.
■ Information to be given to the recipient of the service.
■ A general system for recognising evidence of training.
■ Levels of qualifications.
■ Equal treatment of qualifications.
■ Conditions for recognition.
■ Knowledge of languages.
■ Use of academic titles.
■ Use of professional titles.
The Directive applies to EU citizens wishing to pursue their profession in
another Member State, whether on a self-employed or employed basis. It
applies to natural persons not to juridical persons (e.g. companies). It also
applies to a person who acquires a professional qualification in another
Member State but wants to practice in his/her own state.
16

23. III. METHODOLOGY
1. Introduction
In addition to researching the trade in services and the opportunities that
might arise from the liberalisation under the EU-Cariforum agreements, the
consultants researched the regulatory regimes currently in force in Estonia,
France, Germany, Italy, Malta, Netherlands, Spain and the United
Kingdom. In respect of the following professions and trades:
■ Accountancy, Auditing and Book-keeping.
■ Architecture.
■ Engineering
■ Management Consultancy
■ Tour Operations.
■ Tourist Guide Services.
Our approach to the level of disaggregation in the selected service
industries was based on UNCPC classifications. An important point to note
is that the selected services in this assignment are typically defined at the
UNCPC 3 or 4-digit level (UNCPC classification is the international
classification usually used when categorizing services - see
http://unstats.un.org/unsd/statcom/doc02/cpc.pdf).
This means that the selected service industries are broadly defined and
could be disaggregated further. For example, under the UNCPC,
Management Consulting Services is classified as 8311 which is the 4-digit
level; however this is broken down in six 5-digit categories as follows:
1. General Management Consulting Services.
2. Financial Management Consulting Services.
3. Human Resources Management Consulting Services.
4. Marketing Management Consulting Services.
5. Production Management Consulting Services.
6. Other Management Consulting Services.
On the other hand, Engineering Services is defined as 833, which is the 3-
digit level. However, this is broken down into six 4-digit categories which
are each, in turn, broken down into four 5-digit categories (which means
that there are 24 sub-categories of engineers). There are similar sub-
classifications of architectural and accounting &auditing services.
In this assignment we will treat the selected service industries under the
broad UNCPC 3 or 4-digit categories but if any exceptions or significant
differences are identified, they will be included.
17

24. The consultants researched the regulatory regimes currently in force in
Estonia, France, Germany, Italy, Malta, Netherlands, Spain and the United
Kingdom in respect of the specified professions and trades. All of these
states, with the exception of the UK have a legal system based on the
Roman Law and are described as Civil Law systems.2
It should be noted that the United Kingdom has three separate legal
jurisdictions; England and Wales, Scotland and Northern Ireland. England,
Wales and Northern Ireland are part of the Common Law tradition found in
the Anglophone Caribbean countries. So too is the Republic of Ireland.
Scots Law has its roots in the Civil Law tradition of continental Europe but
with substantial Common Law influences. Both are covered in this report.
Some of the professional bodies for Northern Ireland are arranged on an
all-Ireland basis and these are also covered.
Some countries (UK, Germany, Italy and Spain) have considerable
decentralization and whilst differences are pointed out in the report, we
have given a general national overview.
The review was based on:
■ Legislation 3.
■ Regulations.
■ Administrative procedures.
■ Industry practices.
The consultants have identified and referred to the specific laws and
regulations and provide a database of contacts of all relevant professional
organisations and regulatory bodies. In particular, the consultants
gathered information on the following:
■ Academic qualifications.
■ Accreditation bodies.
■ Professional training.
■ Professional affiliations(s).
■ Professional curriculae and examinations.
■ Licensing, certification, registration, permits and fees.
■ Language requirements.
■ Citizenship, visas etc.
■ Administrative processes.
■ Professional standards.
■ Processes for incorporating new companies.
■ Processes for establishing joint ventures or other alliances.
■ Capitalization requirements.
2
They are based on the Roman Law “ius civilis”, hence Civil law. The Dominican Republic, Haiti and
Surinam also have Civil Law systems.
3
Where possible, the title of the legislative provision is given in the original language and according to
the official legal formulary. This varies considerably across the Member States and particularly between
Common Law countries (e.g. England and Wales) and Civil Law countries (e.g. Germany).
18

25. The methodology included the following:
■ Internet research - to obtain information on the business environment
and relevant regulatory framework issues
■ Telephone interviews to collect information from relevant officials and
industry players
■ Field research by consultants to collect information not available on the
internet and to hold face to face discussions with critical industry
players
■ Visits to relevant staff at DG Trade, DG Dev, DG Enterprise and
Industry, Internal Market and Competition to obtain information on EU
policies and requirements.
■ Visit to France, Belgium, The Netherlands, The U.K., Estonia and Malta
to a) develop a feel for cultural aspects of the countries, b) establish
business relationships, and c) collect any outstanding data.
■ Conduct a two day workshop in Barbados with relevant persons from
the Cariforum countries to outline the main findings and to obtain their
feedback and input.
In some countries information was more readily available than others and
this will be evident in this report. This may be an important indicator of
how open to business under the EPA they are.
We have referred to titles being ―protected in law‖. This means that there
is legislation or regulations laid down by the State as to who may use this
title. Even where a title is not directly protected in law it will usually be
criminal offence to pass oneself off as being a member of a professional
association or holder of professional qualifications when that is not the
case.
2. Business Environment/Market Related Issues
The analysis of the business environment/market related issues includes
the following:
2.1. Overview of the specific domestic market for each of the selected
countries
(a) Size of overall market and growth trends
i. Population
ii. GDP
iii. GDP per capita
iv. GDP growth
(b) Other factors important to trade
i. Extent to which English is spoken – is language a barrier
ii. Quality of the ICT infrastructure
iii. Availability of air and ground transportation
19

26. (c) Size and structure of domestic market for each service
i. Contribution of selected industries to GDP
ii. Size of firms in each selected industry
1. number of firms in each selected industry
2. average turnover
3. number of employees
iii. Survey of associations (or a sample of service providers)
in each of the selected industries to determine
1. number of service providers in each of the selected
industries
2. size of local versus foreign services providers
3. attitude towards foreigners entering the market
4. attitude towards joint ventures and collaboration
5. competitiveness of service providers in each
industry
6. main challenges
7. main users of particular service
a. public sector
b. multinationals
c. large local private entities,
d. small local private sector entities
e. NGOs
f. foreign governments,
g. foreign private sector
iv. Survey of (a sample of) services users to determine
1. the ease with which these services are available
domestically
2. the quality of services provided
3. the price competitiveness of local versus foreign
service providers
4. preparedness to use foreign suppliers within the EU
5. preparedness to use foreign suppliers from outside
of the EU
(d) Overview of the EU policies and requirements and, to do so,
will visit relevant staff at DG Trade, DG Dev, DG Enterprise
and Industry, Internal Market and Competition.
(e) Indicate to what extent there is currently cross-border trade
in these service sectors
20

27. 2.2. Trade related issues in the selected industries in the selected countries
(a) To the extent possible, provide data on trade in the
mentioned services in the target countries (imports and
exports)
(b) To the extent possible, identify if there is there outsourcing of
these services (off-shoring) to firms overseas by large firms in
Europe.
(c) What are relevant EU policies and requirements with respect
to trade in these services
(d) To what extent there is currently cross-border trade in these
service sectors
i. Within the EU (intra-European supply of services).
ii. With countries outside of the EU
(e) To what extent does trade take place in all four modes
i. Mode 1: Cross border – where only the service moves
e.g. by internet, courier, telephone, etc
ii. Mode 2: Consumption abroad - Consumer comes to
service provider
iii. Mode 3: Establishment of a commercial presence in the
foreign country
iv. Mode 4: Movement of natural persons – where there is
temporary movement of service providers.
A questionnaire was prepared and was used by the experts and local
resources in the EU target markets to elicit the above information (see Part
VII: Appendix 5).
2.3. General Framework for Setting up in Business or Supplying Services
For each country we sought to address the following:
■ The Consultant is considering going to country X to look for work – Can
he/she actually go to look for work or must they have a contract before
they can go.
■ Do you need a visa to enter that country? How long does it take to
obtain it? How much does it cost? Who do you have to apply to? What
are the likely hitches?
■ The basic rules (e.g. registration, administrative, fees, permits,
licences) governing setting up in business as:
A sole trader.
21

28. A partnership.
A company (different types).
■ Are these rules different for non-EU persons or businesses?
■ What are the rules re registration for national and local taxes? Also,
does one have to register with the Customs Department?
■ Are there geographical restrictions on where they can and cannot do
business?
■ Are there local taxes and restrictions?
■ What are the provisions governing e-commerce?
■ If qualified with a professional body in the Cariforum countries, does
one have to register with the equivalent in the relevant EU country in
order to provide those services there (e.g. accountancy)? If so, what
does this entail time-wise, fees, etc.
■ Are there restrictions on bringing staff to that country to engage in the
business and, if so, what are they? Is there any limitation on the length
of their stay? Do they need visas and work permits?
■ What are the rules on repatriating profits?
■ Are there restrictions on a non-EU citizen opening a bank account?
What are they? What does he/she need to do to open an account?
■ Are there rules governing the charges that can be made for supplying
professional services?
2.4. Regulatory and Administrative Issues for the Listed Professions
The following matters were addressed for each profession and each state.
We looked at how each profession is regulated, the rules governing access
and rules on establishing a business/professional presence in that EU
Member State:
■ Designation/ Title:
Whether the designation or title of the profession is protected?
If so, whether that is that by law, regulation, professional
association, educational establishment?
How it is protected and what are the consequences for a person
providing those services without that official designation?
Are there specialist sub-designations? E.g. Management
Accountant, Public Sector Accountant, Domestic Tour Operator,
Trekking Tourist Guide?
22

29. If there are specialist designations, how are these
regulated/protected? What proof of specialist
qualifications/training/experience is needed? Are there specialist
professional associations?
Can a corporate body be designated a member of the professions
or become a member of the professional association?
Is there associate membership or quasi-membership e.g.
paralegals?
■ Qualifications:
What are the qualifications that are needed to become a member
of/practice that profession or to provide those professional
services?
How does a person become a member:
Registration procedure, entry qualifications, fees, examinations and other
assessments etc.
Are there rules about where those qualifications were acquired?
What are the rules governing mutual recognition of foreign
qualifications?
Must the qualification be acquired at an accredited institution and,
if so, who does the accreditation? Are any of these in the
Caribbean?
Does the professional association provide courses that lead to the
attainment of the qualification? Do they also offer courses to
external candidates i.e. those overseas?
Are there rules governing the length of time it took to acquire
those qualifications? The number of attempts made? Expiry of
qualifications? Transitional arrangements whereby those who
acquired qualifications under an old regime/system can gain
recognition under the new system?
Is there a ―fast track‖ system for acquiring the qualifications e.g.
intensive training courses or exemptions from some parts of the
course for those that are qualified in other professions or
disciplines?
■ Training/ Experience
Is there a special training requirement to qualify for membership of
the profession?
23

30. Is there a geographical requirement laid down as to where that
training or experience took place or was acquired e.g. ―in France‖,
―in an urban environment‖, ― in both an urban environment and in
at least one project of 12 months duration in a rural setting‖, ―with
at least 6 months experience overseas‖ ?
Are there accredited institutes, firms or professionals that provide
training or work experience?
Is there a system of Accreditation for Prior Experience (APE) which
exempts candidates from some or all of the requirements for
formal qualifications?
Are there rules governing the content of the training course?
Are there Continuing Professional Development (CPD)
requirements?
■ Regulatory Authority
What is the name of the Ministry or State body responsible for
regulating the profession?
What is/are the name(s) of the professional association(s)? What is
their status e.g. State professional associations, private
associations, quasi-public bodies?
Is membership of a particular/any professional association
compulsory? If not, does it provide privileges?
Which body issues the certificate/diploma etc of membership of the
profession? Are there rules about the display of the certificate/logo
etc at business premises, in business stationery, online etc?
Is a special licence needed for the provision of all/some of the
professional services?
Are there rules governing the type of business that a member of
the profession can provide services through (sole trader, partner,
limited liability company, unlimited liability company etc.)?
Are there legal requirements that make it compulsory for
individuals, corporate bodies, public institutions to engage the
services of particular professions (e.g. company accounts must be
audited by a chartered accountant, tour operators must use the
services of a licensed tourist guide etc)?
Can a person be a member of more than one profession? Can the
firm be multi-disciplinary e.g. a firm combining lawyers, architects,
engineers and accountants?
24

31. Are there special rules governing conflict of interest? Activities in
which members of the profession are prohibited from engaging in?
Are there special rules on disclosure of information; on fees and
other charges?
What is the disciplinary body for the profession? What are the rules
governing disciplinary matters?
25

32. IV. OPPORTUNITIES FOR TRADE IN SERVICES
In this section of the report, each of the eight selected countries will be
examined in turn. In each case the following format will be followed:
■ The business environment will be initially outlined (subject to the
availability of data) with the presentation of industry GDP data,
trade data4 and other data on industry size and structure.
■ A flow Chart will be presented outlining the process of setting up a
business in each of the selected countries.
■ An assessment will be made of opportunities in each of the selected
industries for each country using a scoring system based on
responses to questions asked to industry associations and users of
the selected services. The assessment will be made using the
following template:
Industry specific Measurement Criteria
opportunities
Industry size 1= up to 5000 Firms or up to 25000 employees;
4=>5000-15000 Firms or >25000-50000 employees;
7=>15000-25000 Firms or >50000-100000 employees;
10=>25000 Firms or >100000 employees
Very large is a sign of more opportunity
Industry Very competitive=1, Moderately competitive=4,
competitiveness Not competitive=10
Very competitive is a sign of less opportunity
Pricing Local prices cheaper =1, Prices same as foreign = 4,
opportunities Local more expensive = 10
Local prices cheaper is a sign of less opportunity
Quality related International Standard =1, Fairly Good =4, Poor=10,
opportunities If the country has international standards there is
less opportunity for Cariforum service providers
4
It should be noted that the Euro was introduced in 12 EU countries on January 1, 1999, at an exchange
rate of 1:1 with the ECU, which was the unit of currency used for official transactions up to that point.
Many transactions in the EU were therefore measured in EUC/Euro. In this document, wherever one
observes “in 1000 million ECU/EUR”, it is equivalent to “in € billions”.
It should also be noted that in most cases, industry specific trade data were unavailable in the eight (8)
selected countries. However, in all cases trade in “Other Business Services” was available. “Other
Business Services" is a relatively broad category which includes: merchanting and other trade related
services, operational leasing services, legal, accounting, auditing, tax consulting, book-keeping,
management consulting, public relations, advertising, market research, public opinion polling, research
and development, architectural, engineering, other technical services, agricultural, mining, on-site
processing, waste treatment depollution and services between affiliated enterprises).
26

33. Cont………
Industry specific based Measurement Criteria
opportunities
Skill shortage opportunities Services readily available=1, Moderately
available =4, Not easily available = 10
If services are readily available then there is
less opportunity for Cariforum service
providers
Niche opportunities
 different user groups 1=Multinationals and foreign private sector
are not main users; 4= local private sector
are main users; 10= Main users are
multinationals and foreign private sector
When multinationals and foreign private sector
are not main user groups there is less
opportunity
 circumvention of 10= Challenges faced by the local industry
challenges can be capitalized upon by Caribbean
service provider, 1=where there are no
challenges faced by the industry or they
cannot be capitalized on
Attitudes towards joint 1=Negative; 10 =positive
ventures/partnerships
Perceptions towards
foreigners
 openness and 1=Negative attitude towards foreign
appreciation service providers entering the market; 10=
Positive attitude towards foreign service
providers entering the market
 willingness to use 1=Not willing; 4=Somewhat willing but
foreign service skeptical; 10=Very willing
providers (user
perception)
Opportunities created through 10= If there are no EU restrictions that
EU regulations discriminate against foreign services
providers
Different Mode opportunities 10=Price and skill shortage opportunities
can be exploited using certain modes
27

34. 1. Estonia: Opportunities for Cariforum Service Providers
Country specific Score Assessments
opportunities
Country specific opportunities
a. Positively disposed to 8 A quite diverse history – Baltic,
diversity Scandinavian, Soviet
b. Language 7 Most business people speak English
c. Proximity to other regions 10 A natural gateway to the former
Soviet, Baltic and Scandinavian
States
d. Persons willing and 10 Consultants made linkages with
prepared to coordinate and Chamber of Commerce which is
cooperate favorably disposed to coordinating
trade missions and conducting
matchmaking
1.1. Size and structure of domestic market for each service
Contribution of selected industries to GDP (in Euros Millions)
Industry 2003 2004 2005 2006 2007 2008
Accountancy services
& auditing 95.62 115.83 122.00 144.15 167.97 190.32
Architecture and
engineering
(only consolidated
information is
available) 286.86 328.15 388.17 458.65 534.46 570.95
Management
Consultancy 52.16 57.91 66.54 91.73 122.16 111.02
Tourist Guide
Services and Tour
Operators (only
consolidated
information is
available) 669.33 772.11 865.07 1009.03 1145.27 1189.47
Source: Statistics Estonia and calculations by Chamber of Commerce.
28

35. Size of each selected industry
Industry Number Average Number of Largest two firms
of firms Turnover/Sales Employees (by relevant
(million/€) (average) business
organization)
Accountancy 2500 0.35 10 1. KPMG Baltics AS,
services & 2. Pricewaterhouse
auditing Coopers AS
Architecture 950 0.13 5-9 1. EA Reng AS,
2. SWECO Projekt AS
Engineering 2550 0.29 7-12 1. K-Projekt AS,
2. Nord Projekt AS
Management 540 0.26 1-5 1. BDA Consulting OÜ,
Consultancy 2. Christiansen
Consulting OÜ
Tourist Guide 200 0.09 1-5 1. Gotravel OÜ,
Services 2. Risiekspert OÜ
Tour Operators 250 0.64 10 1. Estravel AS,
2. Kalevatravel AS
Source: Industry Associations in Estonia, 2009
Number of Local and Foreign Firms in Each Industry
Industry Total # % Number Number of
firms foreign of local foreign
firms firms firms
Accountancy services & 2500 20%
2000 500
auditing
Architecture 950 15% 808 143
Engineering 2550 20% 2040 510
Management Consultancy 525 35% 341 184
Tourist Guide Services 200 15% 170 30
Tour Operators 250 35% 163 88
Source: Compiled from Data provided by Industry Associations in Estonia, 2009
Distribution of Local Firms by Size Based on Number of Employees (% in
each category)
Firm Size (No. employees) 1-10 11-20 21-50 Over 50
Accountancy services & 60% 25% 10% 5%
auditing
Architecture 75% 15% 7% 3%
Engineering 75% 10% 8% 7%
Management Consultancy 50% 35% 10% 5%
Tourist Guide Services 85% 10% 5% 0%
Tour Operators 50% 30% 15% 5%
Source: Industry Associations in Estonia, 2009
29

36. Distribution of Foreign Firms by Size Based on Number of Employees
(% in each category)
Firm Size (number of 1-10 11-20 21-50 Over 50
employees)
Accountancy services & 15% 15% 20% 50%
auditing
Architecture 45% 50% 3% 2%
Engineering 45% 50% 3% 2%
Management Consultancy 40% 45% 10% 5%
Tourist Guide Services 75% 10% 15% 0%
Tour Operators 40% 40% 15% 5%
1.2. Trade in Services
■ Overall Export of services5
Chart 1 shows the steady growth of Estonia‘s export of services
between 2000 and 2007. The country saw steady growth in exports
rising from €1.6 billion in 2000 to €3.2 billion in 2007.
Chart 1: Overall export of services (in € billions)
3.5
3
2.5
2
Overall export of services
1.5
1
0.5
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
5
It should be noticed that the Euro was implemented in 12 EU countries on January 1, 1999, at an
exchange rate of 1:1 with the ECU which was the unit of currency used for official transactions up to
that point. Many transactions in the EU were therefore measured in EUC/Euro. In this document,
especially in charts, wherever one observes “in 1000 million ECU/EUR”, it is equivalent to “in €
billions”.
30

37. ■ Overall Import of Services
Chart 2 shows the trend in Estonia‘s import of services between 2000
and 2008. Services imports grew from €1 billion in 2000 to €2.2 billion
in 2008.
Chart 2: Overall import of services (€ billions)
2.5
2
1.5
Overall import of services
1
0.5
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
■ Net overall balance of trade on services
The net overall balance of trade on Estonia‘s services is revealed in
chart 3 below. It was in surplus throughout the 2000-2007 period,
increasing from a surplus of €0.6 billions in 2000 to €1 billion in 2007
with some fluctuations along the way.
Chart 3: Net overall balance of trade on services (in € billion)
1.2
1
0.8
Net overall balance of trade
0.6
on services
0.4
0.2
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
31

38. ■ Exports of other business services
Chart 4 outlines the trend in Estonia‘s export of other business services
for period 2000 – 2007. These exports increased from €0.2 billion in
2000-2002 after which it rose steadily to €0.6 billions in 2007. Other
business services include several categories of professional services
including some of those being covered in this study.
.
Chart 4: Exports of other business services (in € billion)
0.7
0.6
0.5
0.4 exports of other business
services (1000 million
0.3 ECU/EUR
0.2
0.1
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
■ Imports of other business services
Chart 5 outlines the trend in Estonia‘s import of other business services
for period 2000 – 2008. Similar to its other business services exports,
Estonia‘s imports of other business services was €0.2 billions in 2000-
2002 after which it rose slightly to €0.3 in 2003, but then remained
constant for the next 3 years, after which it rose to €0.5 billions in
2007.
32

39. Chart 5: Imports of other business services (in €
billion)
0.6
0.5
0.4
imports of other business
0.3 services (1000 million
ECU/EUR)
0.2
0.1
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
■ Net balance of trade in other business services
The net performance of Estonia‘s trade of other business services
between year 2000 and year 2008 is shown in chart 6 below. For the
first half of the period examined, Estonia recorded a balanced trade
position as both imports and exports of other business services
recorded the same figures. However, there was a balance of trade
surplus of €0.1 billions in other business services in 2004 which
increased to €0.2 billions for the remaining years 2006-2007.
Chart 6: Net balance of trade in other business services (in € billion)
0.25
0.2
0.15 Net balance of trade in other
business services (1 000
0.1 million ECU/EUR)
0.05
0
2000 2001 2002 2003 2004 2005 2006 2007
Year
33

40. 1.3. Steps for Establishing a Business in Estonia
1. 2. 4.
Check the uniqueness of
Deposit initial capital in bank Register for VAT at
proposed company name
and obtain a bank notice National Tax Board
(1 Day, No charge)
certifying the payment (Up to 3 Days, no charge,
(1 Day, No charge) General VAT rate is 18%)
5.
Register with the Central Sick
3.
Fund of Estonia Submit the registration application
(1 Day, No charge) to the Commercial Register
(1 Day, State fee of 2200 EEK.
If electronic application,
State fee of 2900 EEK.
LENGTH OF TIME: 7 DAYS
TOTAL COST: €140 (PHYSICAL)
OR €190 (ELECTRONIC)
34

41. 1.4. Industry Specific Opportunities in Estonia
1. Accounting and Opportunity Assessment Criteria
Auditing Industry Score
specific opportunities (Max = 10)
Industry size 1 Relatively small industry
Industry competitiveness 1 Very competitive
Pricing opportunities 4 Local and foreign prices are
about the same
Quality related opportunities 4 Fairly good
Skill shortage opportunities 1 Local service providers readily
available
Niche opportunities
different user groups 10 Opportunities with
Multinationals and foreign
private sector because they are
two of the main users of
accounting & auditing services.
circumvention of 10 The major challenge faced is
challenges high labour costs and
competition so there are
possible opportunities for
Cariforum services providers
Attitude towards joint 10 Attitude towards joint ventures
ventures/partnerships with foreigners is very positive
Perceptions towards
foreigners
openness and 8 Attitude towards foreigners
appreciation entering the market to offer
services is quite positive
willingness to use foreign 4 Somewhat willing but a little
service providers (user skeptical
perception)
Opportunities created through 10 There are no major restrictive
EU regulations EU regulations
Different Mode opportunities 10 There may be some Mode 1 and
4 opportunities due to high
labour costs. User interviews
supported the fact that these
Modes have already been used
35