EU scales back services directive

In a vote seen as an acid test of the EU's commitment to economic reform, the European Parliament approved by 394 votes to 215 a revised blueprint of the services directive - the measure which prompted fears in France of an invasion of Polish plumbers.

Despite the rift over the issue, unions and some business organisations claimed victory over the compromise which national governments will now find hard to revise significantly. Unions welcomed the deal because the measure removed the controversial "country of origin" principle under which firms could have operated in any of the EU's 25 member states as long as it abided by its home country rules.

Nevertheless, potential beneficiaries of the legislation include a variety of European firms offering services in foreign countries including, architects and accountants as well as building trades such as plumbers.

Exempted areas include broadcasting, postal services, audio-visual services,legal services, social services, public transport and gambling - and public, but not private, health. However, so-called services "of general public interest" including waste management, will be covered by the directive.