The battle to keep water out of the european internal market

A test case for democracy in Europe.

The European Commission has in recent weeks gone on a PR offensive in response to growing criticism of its pro-privatisation agenda for the water sector. The criticism centres around the water privatisation conditions attached to the Troika’s rescue packages for Greece and Portugal, and the proposed EU concessions directive, which could lead to increased privatisation pressure on public water municipalities across Europe.

The concessions directive, which has the stated object of opening markets and eliminating “discrepancies among national regimes”, would end the exemption that has so far existed for drinking water supply and for the first time bring it under the rules of the EU’s single market.

Previous attempts to bring water under single market rules failed due to resistance from civil society and MEPs opposed to water becoming a commodity, but this time the European Parliament has been less vigilant. The directive would not directly force municipalities to privatise, but could lead to ‘privatisation through the back door’. Municipalities who have some form of private participation in their water supply, even a small part, would have to offer their water contracts for EU-wide bidding. This would give private water multinationals like Suez and Veolia new opportunities to expand. All of this has sparked strong public concern in Germany, Austria, The Netherlands and elsewhere. The concerns were shared from left to right and even the governing German conservative party, the CDU, passed a resolution at its congress rejecting the concessions directive and calling for water to be exempted. German Chancellor Merkel however, has so far ignored these concerns. The concessions directive is currently in its last phase of decision-making, a so-called trialogue procedure involving the Commission, Parliament and the Council of EU member states.