Πέμπτη, 4 Ιουνίου 2009

Better Regulation


1. Introduction
Regulation is essential to achieve the aims of public policy in many areas, and better regulation is not about unthinking removal of such regulation. Rather, it is about ensuring that regulation is only used when appropriate, and about ensuring that the regulation that is used is high quality. Improving the quality of regulation is a public good in itself, because it enhances the credibility of the governance process and contributing to the welfare of citizens, business and other stakeholders alike. High quality regulation prevents the imposition of the unnecessary burdens on businesses, citizens and public administrations that cost them time and money.
It helps avoid the damage to firms’ competitiveness that comes from increased costs and market distortions (particularly for small firms). Indeed, studies from various sources have estimated the burden of regulation to fall in the range 2-5% of GDP in Europe. Whilst these figures can only be estimates, nonetheless they do indicate the importance of this issue to European economies. High quality regulation assists in the restoration of confidence in government and is better able to accomplish its desired purpose. Implementation of such regulation is also less problematic for public administrations and compliance is easier for citizens.
For all these reasons it is strongly in the public interest to improve the quality of regulation at both national and EU levels. Better regulation needs high-level and cross-governmental political support and appropriate resources to be successful. It must address the whole life cycle of policy (inception, design, legislation, implementation and review) across all fields of public policy. A little by little approach has the risk that it could be ineffective and therefore, an overall strategic approach is essential. It should seek to involve both the executive and the regulatory authorities, using tools such as impact assessment, simplification, consolidation and consultation and promoting a change in culture. And it must be underpinned by appropriate administrative and organisational structures: both within national governments and the EU Institutions such structures should co-ordinate, support and monitor the programme and, additionally in the EU, promote mutual learning between its Institutions and with the Member States.
Better regulation is a drive to improve the policymaking process through the integrated use of effective tools, not an attempt to impose further bureaucratic burdens on it. Its effective use will deliver welfare gains far in excess of any costs of governing in such an efficient way.

2. Key areas of better regulation

The seven key areas that result from the aforementioned considerations are:
- Policy implementation options. National policymakers should always consider the full range of possible options for solving public policy issues and choose the most appropriate for the circumstances: though regulation is often the most appropriate option it should not be automatically the only choice in all circumstances.
- Impact assessment. Regulatory impact assessment (RIA) is an effective tool for modern, evidence-based policy making, providing a structured framework for handling policy problems. RIA should be an integral part of the policy making process at EU and national levels and not a bureaucratic add-on. It does not replace the political decision: rather it allows that decision to be taken with clear knowledge of the evidence.
- Consultation. Consultation is a means of open governance, and as such early and effective consultation of interested parties by EU and national policymakers is an important requirement. This does not undermine the role of civil servants, Ministers or Parliamentarians in the policymaking process, but supplements the information they have to supply. Correctly done, consultation can avoid delays in policy development due to late-breaking controversy and need not unduly hinder progress.
- Simplification. There is a constant need to update and simplify existing regulations. But simplification does not mean deregulation. It is aimed at preserving the existence of rules while making them more effective, less burdensome, and easier to understand and to comply with. This entails a systematic, preferably rolling and targeted programme of simplification, covering the regulation that impacts on citizens, business and the public bodies that have to implement it. Such programmes need to be established at both EU and
national levels.
- Access to regulation. Those affected by European or national regulation have the right to be able to access it and understand it. This means the coherence and clarity of regulations must be enhanced through consolidation (including codification and recasting) and access improved by better practical arrangements (especially using ICT). The former should be achieved through EU and national level programmes of consolidation and the latter through provision within each Member State and at European Union level of a public access service (either free or for a small fee).
- Structures. Better regulation needs the appropriate supporting structures charged with its promotion to be successful. The best arrangement at EU or national level will depend on the relevant circumstances and charging a single unit at or near the centre with this should certainly be considered, but an effective solution must be found for each.
- Implementation of European regulation. High quality regulation forms a chain from the earliest stages of its preparation through to its implementation. More attention should be paid at European level to implementation concerns to ensure that the full consequences are understood and considered. Member States should accord implementation of European regulation higher priority.


3. The basic principles of better regulation are the following:

Any legislative initiative should attain to implement the following principles:

Necessity
This principle demands that, before putting a new policy into effect, the public authorities assess whether or not it is necessary to introduce new regulations in order to do this. This would for example involve comparing the relative effectiveness and legitimacy of several instruments of public action (regulation, but also the provision of information for users, financial incentives and contracts between public authorities and economic and social partners) in the light of the aims they wish to achieve.

Effectiveness

Effective regulation requires clear, achievable objectives and ensuring that these policy goals remain to the fore throughout the regulatory process. An objective-led approach to regulation places greater emphasis on performance and outcomes. However, the assumptions underlying the stated objective must also be clear. These are the important events, conditions or decisions outside the regulation that must nevertheless prevail for the objective to be attained.
Proportionality
This principle means the regulation should be lightly as possible given the circumstances, and that more alternatives are used. Further, that both the burden of complying and the penalty for not complying are fair. And that Regulatory Impact Analysis is appropriately used when making regulations.
Transparency
In order to improve the quality of regulation by being more effective in identifying unforeseen effects and taking the points of view of the parties directly concerned into consideration, the drafting of legislation should not be confined within the narrow bounds of the public administration bodies. Participation by and consultation with all parties who are interested or involved prior to the drafting stage is the first requirement of the principle of transparency. This participation should itself satisfy the transparency criteria. It should be organised in such a way as to facilitate broadly based and equitable access to the consultations, the constituent elements of which should be made public.
Accountability
The authorities responsible for regulation should give consideration to the question of its applicability. All parties involved should be able to clearly identify the authorities that originated the policies and the regulation applying to them. Where appropriate, they should be able to inform them of difficulties with the implementation of policies or regulation, so that they can be amended.
Consistency
Consistency addresses the questions: will the regulation give rise to anomalies and inconsistencies, given the other regulations that are already in place in this area? Are we applying best practice developed in one area when regulating other areas?
Consistency in the regulatory process is important as it gives a degree of predictability and legal certainty to individuals and groups within society and the economy. Ad hoc approaches, whereby similar situations are treated differently, tend to add to transaction costs associated with particular activities. They can also create unnecessary bureaucratic layers to social and economic processes, and ultimately diminish respect for the regulatory process.

4. Alternatives to regulation
There are alternatives to regulation, which should be taken into consideration before starting any legislative project. These are the following:
a) Do nothing. Not acting when faced with a given problem may be necessary and should be considered as being a possible alternative. It is a way of placing confidence in existing regulations whilst avoiding implementing a solution too early which might turn out to be untimely.
b) Incentive mechanisms. These may be in the form of information campaigns to make citizens and companies aware of their rights and obligations. They may also be in the form of educational or preventative campaigns intended to have an effect on behaviour enabling the effective implementation of regulations which are known but have not been put into practice. Lastly they may also be financial incentives (bonuses or surcharges) encouraging people to change their behaviour (for example differential taxation of unleaded petrol).
c) Self-regulation. This instrument of self-regulation is unique to the private sector. In the form of quality standards, certification, codes of conduct, groups of economic players can seek to improve their technical quality and/or their commercial performance. This form of regulation can contribute to the general interest by the simple benefits (price, safety, etc) that it provides for the consumer. It may also include wider interests (in particular by taking into account the demands of environmental protection associations). In as much as user satisfaction can be achieved using this method, the public authorities do not need to intervene in the domain covered by self-regulation.
d) Contractual policies. Contractual regulation can link public authorities to players in the private sector (companies, associations, individuals). These can be financial rewards given in return for complying with quality standards (for example environmental protection) or activities contributing to the public service (particularly in the social domain). The same methods can be used to link different public authorities (for example to implement European structural funds or for relations between States and decentralised levels of authority). Finally, this form of regulation can involve private sector players. The conclusion of a contract establishing rules common to partners with different interests (for example employers’ representatives and employees unions) shows that some of the objectives which are characteristic of regulation (the general interest) have begun to be taken into account without the automatic intervention of the public authority.
e) Mechanisms to ensure the assumption of responsibility. For the implementation of public policies it may be desirable to introduce mechanisms guaranteeing that, even in the absence of regulation, the players involved effectively assume their responsibilities and fulfil their obligations. Setting up compulsory insurance systems (such as civil liability or motor vehicle insurance) provides a non-contentious guarantee that risks will be taken care of by a third party. Legal or arbitration procedures are also a way of applying civil or criminal law sanctions where these responsibilities have not been met.
f) Mutual recognition. In Europe a relevant example of an alternative to regulation can be found in the mutual recognition of national rules even when these differ from one country to the next. This is particularly the case when validating professional qualifications or diplomas. Lastly, with regard to alternatives to regulation at the European Union level, it is worth underlining the benefits of the “open co-ordination method” which allows Member States to work towards common objectives together with the help of methods implemented at the national level and the mutual exchange of information.
g) Improving existing regulation. In some cases, the implementation of new regulations is the result of not applying existing regulations. It is worth studying the methods which would enable the rules either to be implemented effectively (by resolving the specific problems which prevent them from being applied) or revised (in particular by periodically revising regulations).
5. Law drafting procedures

The actual drafting of legislation (i.e. the preparation of the legislative text which converts a policy into legally enforceable normative rules) is somewhat more expert work than is generally recognised. It cannot be assumed that it can be undertaken by every lawyer; the skill usually has not been acquired as part of legal education and in the course of legal practice. Law drafting is a type of specialist legal practice (for which some have more talent than others) which demands special skills and relevant experience. Expert understanding of the work is also desirable in those required to carry out verifications of legislative text, whether for Government or Parliament.
Law drafting may be undertaken by officials in a ministry (or in Parliament) who are principally engaged in legal work. Alternatively, and much less commonly in continental Europe, they can be provided as a central resource upon which individual ministries may draw. By either means, good quality drafting calls for a resource of skilled and experienced officials.
The Five Stages of the Drafting Process are the following:
1. Understanding the project.
2. Analysing the project.
3. Designing the scheme.
4. Composing and developing the draft.
5. Scrutinising and testing the draft.
Furthermore, the principles of Legislative Design that have been established in practice are the following:
1. Related provisions should be gathered together in the same part of the bill, and distinct groups of related provisions should be created as separate Parts of the bill.
2. Groups of provisions, and Parts, should be ordered according to the same principles that govern individual provisions.
3. Primary (or basic) provisions should come before those subsidiary provisions that develop or expand or depend upon them.
4. In particular, general propositions should come before a statement of exceptions to them.
5. Provisions of universal or general application should come before those that deal only with specific or particular cases.
6. Provisions creating bodies should come before those that govern their activities and the performance of their functions.
7. Provisions creating rights, duties, powers or privileges ("rules of substance") should come before those that state how things are to be done ("rules of administration or procedure").
8. Provisions that will be frequently referred to should come before those which will not be in regular use.
9. Permanent provisions should come before those that will be in force or have application for only a limited time (e.g. during a transitional period).
10. Provisions affecting a series of related events or actions should be set out following the chronological order in which those events or actions will occur.
11. The objectives of the bill should be stated at the beginning, since they set the context in which the provisions that follow must be read.
12. Any definitions provided for terms used in a bill should be set out before the terms are used; in any case, the way in which a bill is using a term should be self-explanatory from the first occasion that the term is used.
13. The application or coverage of the bill (i.e. the statement of general cases dealt with and not dealt with) should come before the provisions that apply to those cases.
14. Provisions setting out the scope of powers to make secondary legislation should be dealt with after the substantive provisions of the legislative scheme.

Finally it is recommended to take into account of the following principles of Legislative Composition:

1. Express normative rules as prescriptions rather than in narrative form.
2. Express norms directly, avoiding circumlocution, and include only those norms that perform a necessary legal function.
3. Avoid long sentences.
4. Follow word order in conventional usage.
5. Use expressions in every day usage, wherever possible; avoid unnecessary
legal jargon, but use legal terms to express legal concepts.
6. Omit unneeded words.
7. Use terminology consistently throughout a bill and in all secondary legislation implementing it; use the same term for the same case, and a different term for a different case.
8. Avoid ambiguous expressions and terms that are vague and lack clear definition.
9. Limit cross-referencing to other norms as a method of providing the content to norms.
10. Make amendments to other laws by express alteration of specified provisions.

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