Domestic market reforms pass first hurdle

Teachers could soon find it easier on the domestic work market Keystone

The House of Representatives has voted in favour of opening up the domestic work market – a move aimed at boosting the home economy.

On Thursday the House voted by 134 votes to six to reform the law governing the domestic market, the origins of which date back over a decade but have never been fully implemented.

If the Senate follows suit, workers in professions like catering and teaching would no longer need to cut through lots of red tape if they move to another part of the country in future.

It is widely agreed that much of Switzerland’s domestic economy still enjoys considerable protection from competition. This contrasts starkly with the export-dependent part of the economy, which has to compete on world markets.

Roughly every second Swiss franc is earned abroad, but the majority of Swiss jobs are in sectors governed to a large extent by cantonal – and in some cases municipal – borders.

The domestic market reforms seek to address this imbalance by making it easier for professionals to compete across borders.

This effectively means that current barriers to non-locals on the work market will be lifted – primarily by ensuring that qualifications recognised in workers’ canton of origin are automatically valid across the country.

Welcomed

The proposal also gives the federal Competition Commission more power to appeal against any decisions that it suspects do not conform with the amended legislation. Currently it can only make recommendations.

Economics Minister Joseph Deiss, who has long been fighting against the apparent lack of political will to tear down barriers to doing business in and between Switzerland’s 26 cantons, said he welcomed the result.

He said it was very important to establish a Swiss-wide standardised market.

Switzerland’s federal structure devolves much of the power to decide and implement regional economic policy to the cantons.

While that encourages competition in some areas – for instance taxation policy – some local and regional authorities have been accused of protectionism and of hindering the free movement of skilled workers between cantons.

Teachers, hairdressers, dentists, engineers and hoteliers, for example, need to obtain a new work permit if they want to set up shop in another canton.

This has led to complaints that it is easier for a foreigner to come to work in some cantons than it is for certain Swiss professionals to switch cantons.

False dawn

The reforms are expected to affect more than 50 professions and up to 250,000 people across the country.

When the current domestic market law was introduced with great fanfare in October 1995, the government hailed it as an important step towards eliminating restrictions and barriers put in place by the cantons. But putting it into practice turned out to be another matter.

In a statement to parliament ahead of the debate, the government said it was time to face up to the fact that “there is a gap between the aims of the [1995] domestic-market law and its achievements to date”.

“In fact, until now this law has not led to any notable opening of the market.”

swissinfo with agencies

Key facts

Around 250,000 people could benefit from the amended legislation.
Those who are likely to benefit most are teachers, health workers, engineers and architects and hoteliers and restaurant owners.

In brief

The new law, which amends the 1995 legislation, has three goals:

To break down local barriers to domestic-market entry.

To remove geographical restrictions on individuals practising their trade that could also prevent Swiss citizens facing disadvantages in Switzerland compared with EU nationals.

To give the Federal Competition Commission binding powers at cantonal and communal level.