Single European Market Loopholes

By removing barriers to trade, commerce and industry, SEM initiated a new era of liberalization of free movement which benefited millions of people throughout Europe. Policies were developed and frameworks regulated. Market failures were categorized and arranged market wise. With the failure of managing income and distribution issues, tax and beneficiaries were blamed. Economic insecurity and reduced transaction costs were thrust in the inefficiencies of deploying inappropriate rules and norms while other market failures were put down by the SEM under the influence of increased demands of the European society.

The barriers which started emerging across Europe spread rapidly and effected discriminatory trade practices. From motor vehicles to electronic equipments and from consumer goods to wine and beverages, SEM initiated a new era of competition and differences among trade sectors. Even technical barriers took place with the emergence of disturbance in consumer and intermediate goods. Firms like medical, engineering, electronic and transport all escorted by different restrictions and national regulations which made the situation worst by cost-increasing barriers. These firms were subjected to a heavy loss for not meeting up the national market entry requirements.

In the commercial market place technology and innovation was obstructed by market segmentation. Multinationals were not having common business perspectives while small and medium scale firms lost in competition with problems such as technical barriers and high-quality standards. This evidenced that the technology driven European firms despite being a 'Single Market' remained unable to cope up in a global market unit.