Shaky start to liberalization reform

Launching its liberalization program by targeting the road haulage sector last summer was very much a baptism of fire for the government in its efforts to pry open closed-shop professions.

The experience of truck drivers striking for several weeks in 2010 was an unpleasant one, both for the country?s central administration and for society at large, as numerous sectors were adversely affected. Supermarkets experienced product shortages, gas stations ran dry and Greece?s exports fell to record lows.

A few months later, and after the liberalization of the sector was enacted by law last December, we are now seeing the results of the first year in the three-year transitional phase of the plan.

According to the law, over the course of the three-year period, the cost of new haulage licenses will be gradually lowered so that they will be free by July 2003.

The cost of new licenses has already decreased by 30 percent since last January, based on the original price stated in the law. The initial cost was set at 10,000 euros for the first ton and an additional 2,000 euros for the second to seventh ton, and 1,500 euros for the eighth to the 40th ton.

In two years? time, anyone interested in becoming a truck driver will no longer have to pay to acquire a permit up front, but only the cost of an administrative fee, which is expected to be around 1,500 euros.

On a practical level, the road haulage sector stands frozen right now, as no one is interested in paying to join a profession today when they can wait two years for free entry.

Theory vs practice

In theory, since July 2, hundreds of professions that were considered ?closed? have now been liberalized. On a practical level, however, the reality is starkly different, as the state mechanism has once more proved incapable of dealing with the workload that the change, which is critical in the current efforts to boost the economy, has thrown at it.

One example of state obtuseness is that a full list of the professional sectors affected has yet to be published. Even the European Commission is aware of the delay, as in a recent report it said that the Greek government has only made ?limited? progress in liberalization. The Commission?s report also states that additional measures will need to be taken in order to ensure the full liberalization of the profession of lawyers and civil engineers, who will no longer have set minimum fees.

Another important obstacle to the liberalization process is that the final legal steps have not yet been taken in regard to a small number of limitations imposed by the Council of State, the country?s highest administrative authority, that will continue to apply to certain sectors.

What the liberalization of a sector entails in effect is a lifting of a series of restrictions and rules that govern entry into that profession. Meanwhile, whereas in the past new admissions into a profession would have to apply for an administrative permit, now they need to simply register at the tax authority as practicing a certain profession.

The liberalization reform does not just include the sectors listed in the agreement Greece signed with its international creditors — lawyers, civil engineers, architects, notaries and auditors.

According to the law, as of July 2, other restrictions that have been lifted include the number of people allowed to practice a given profession; geographical limitations to the practice of a given profession; minimum distances between practitioners of a given profession; the minimum number of facilities one individual is allowed to run; flat minimum rates; and the imposition of offering specific other services together with the main services stipulated by the profession.