EU Aims To Slash Unnecessary Burden For Registering Cars In Another Member State

Each year, EU citizens and companies have to move some 3.5 million vehicles to another Member State, and need to get them registered according to the national legislation. However, what should be a simple registration procedure in the 21st century Single Market remains a cumbersome and lengthy administrative procedure because of the diversity of rules and the various conflicting requirements.

It takes on average 5 weeks to complete the procedure and the cost is estimated at €400 for citizen and for businesses. Moreover, these problems also represent a significant barrier to the free movement of goods, services and workers, and therefore for growth and jobs creation in Europe. This is why the European Commission is acting today to dramatically reduce this unnecessary administrative burden. The proposal presented by Vice-President Antonio Tajani would lead to a very substantial administrative simplification with total savings of at least € 1.5 billion per year for businesses, citizens and registration authorities.

The proposal is straightforward and tackles very concrete issues. The re-registration of vehicles coming from another EU country will be limited, for example citizens who work in another EU country using a car registered by their employer will not need to re-register it. Generally administrative formalities for the re-registration within the EU of cars, vans, buses and trucks will be greatly simplified, for example when moving residence from one EU country to another and when purchasing a second hand car from another EU country. It will also become impossible to register a stolen car in another EU country. Car-rental companies will save substantially, as they will be able to transfer cars to another EU country during the holiday periods without re-registration. This is good news for tourists as it is expected that renting a car will become cheaper, once today’s proposal will be approved.

European Commission President José Manuel Barroso said: “With today’s proposal the Commission wants to make it as easy as possible for citizens and companies to move and register cars across borders in the European Union. Greatly simplified rules for cross-border car registration and a substantial reduction of administrative burden will bring us a step closer to a smooth functioning Single Market, our engine for growth and jobs.”

European Commission Vice President Antonio Tajani, responsible for Industry and Entrepreneurship said: “20 years after the entry into force of the internal market it is unacceptable that there are still so many obstacles for citizens and business. Our proposal puts an end to many car registration formalities and lengthy procedures. This means substantial savings for rent-a-car companies. Economy as a whole will win, and in particular the tourism industry.”

Formalities for re-registering a car in another EU country will be radically reduced

The proposal put forward today means an improvement for persons who spend a part of the year in another EU country who are currently often requested to re-register their vehicle. The proposal introduces the principle that a car should be registered in the EU country where its owner lives, and that all other Member States may not ask her/him to register the car with them, even if the car owner spend a longer period there.

When the proposal is adopted by the European Parliament and the Council, this will imply:

• Citizens who spend part of the year in a holiday residence in another EU country will not have to re-register their car there.
• Citizens who move permanently to another EU country will have 6 months to re-register their car there.
• Citizens who buy or sell a second-hand car in another EU country will not have to face additional technical controls and administrative problems.
• Citizens who work in another EU country and use a car registered by their employer there will no longer have to register it in their home country.
• Car-rental companies will be able to transfer cars to another EU country during the holiday periods without re-registration (e.g. keeping the same cars at the sea side during summer and in the Alps during the winter). This should lower the price of car rentals.
• For companies, the same principle applies: the cars, buses, vans and trucks should be registered in the EU country where the main office is established, and other EU countries must accept this.
• Registration authorities will increasingly cooperate with each other, making it easier to track stolen cars. It will become impossible to register a stolen car in another EU country.
• Many controls will be abolished altogether, with authorities getting any technical information they need about the car directly from their colleagues in the country where it is already registered.

Background

In the 2010 EU Citizenship Report “Dismantling the obstacles to EU citizens rights”, the Commission identified car registration problems as one of the main obstacles faced by citizens when exercising their rights under EU law in their daily lives and announced, as one of the 25 concrete actions envisaged to remove such obstacles, the simplification of the formalities and conditions for the registration of vehicles registered in another Member State.

The 651 citizens and 151 businesses responding to the public consultation in 2011 mentioned the following problems:

Registration problems have a negative impact on citizens and businesses. Long procedures (for 77.8 % of citizens and 83.1 % of businesses) and extra costs (for 86.5% of citizens and 81.4 % of businesses) are identified as the main effects, with 50.8% of businesses being discouraged from moving cars from one Member State to another. This is why 55.9 % of the businesses consulted feel that their productivity is seriously affected. For 64.4 %, they also affect growth. Finally, 23.7% of citizens and 28.8 % of businesses stated that, in the end, they could not register a vehicle in the Member State concerned.

The proposal will now be discussed by the European Parliament and the Council. Once it will be approved Member States will be given one year to prepare for the new procedures, such as software for data exchange etc.

The Commission will take an initiative later this year to clarify EU rules that Member States must respect when car registration and circulation taxes are applied. The Commission will make recommendations to improve the single market, in particular to avoid double taxation of cars when citizens move from one Member State to another and to remove obstacles for cross-border car rentals.