EU’s Competitiveness Compass: A Strategy for Growth and Innovation

The European Commission has just unveiled its Competitiveness Compass, a strategic blueprint to bolster the EU’s economic strength over the next five years.[1] This initiative comes in response to mounting challenges, including lagging productivity, global technological competition, and high regulatory burdens on businesses.

Key Challenges Identified According to the Compass

Despite Europe’s robust Single Market and skilled workforce, it has fallen behind in key innovation sectors. The EU struggles to translate research into marketable technologies, while energy costs and regulatory complexity weigh heavily on businesses. Moreover, global players like China and the US have outpaced Europe in several advanced technologies, raising concerns about economic sovereignty.

The EU’s Proposed Solutions

To regain its competitive edge, the Commission sets out three transformational imperatives:

1. Closing the innovation gap – Enhancing research commercialization, scaling up startups, and fostering cutting-edge sectors like AI, clean energy, and biotech.

2. A roadmap for decarbonization and competitiveness – Aligning green policies with economic growth, reducing energy costs, and boosting industrial investment.

3. Reducing dependencies and enhancing economic security – Strengthening supply chains, expanding trade partnerships, and ensuring fair competition in global markets.

   
   

The Competitiveness Compass also emphasizes regulatory simplification, a refocused EU budget, and stronger policy coordination among Member States to foster investment and job creation.

What’s Next?

The new Commission aims to translate these proposals into concrete action, with legislative and financial initiatives planned throughout 2025-2026. Businesses operating in the EU should prepare for upcoming policy changes affecting digital transformation, competition law, and industrial support mechanisms.

Stay tuned as we analyze the legal and commercial implications of these reforms!

[1] The document has been published on 29 January 2025 and is available here: https://commission.europa.eu/document/download/10017eb1-4722-4333-add2-e0ed18105a34_en

General Product Safety Regulation 2024: New Standards for Safer Products

The General Product Safety Regulation[1] (GPSR), replacing the previous legal provisions on the topic of non-food products,[2] was adopted by the European Parliament in March 2023, and it officially came into force on 12 June 2023. However, businesses are given a transition period to adapt to the new rules. Hence, the provisions of the GPSR will start applying from 13 December 2024. This means that there is still time for manufacturers and distributors of products to factor the new rules in their operations. Time will soon run out though. Below we tried to summarize what there is to know on the topic in a nutshell.

The aim of the GPSR is to ensure the health and safety of consumers and the functioning of the internal market as regards products intended for consumers[3] in the context of the new challenges posed to product safety by the digitalisation of economies within the EU.[4]

In brief, the GPRS:

• broadens the scope of product safety legislation to include new product types or emerging technologies.

• enhances market surveillance imposing stricter measures for compliance and risk monitoring.

• focuses on online sales and the safety of digital goods.

The upcoming changes will have a direct impact on businesses and consumers. For businesses, the new provisions mean more obligations and stricter requirements, while for consumers, they (should) mean greater peace of mind and trust in product safety.

Key aspects to be considered by businesses are included in the table below.

Table on key considerations GPSR

Conclusion

As the General Product Safety Regulation 2024 takes effect, businesses and consumers alike will benefit from enhanced protections and stricter safety standards, fostering a safer market environment.

If you’re a business wondering what the GPSR means to you in practice, feel free to reach out to us. Happy to help!

[1] Regulation (EU) 2023/988 of the European Parliament and of the Council of 10 May 2023 on general product safety, amending Regulation (EU) No 1025/2012 of the European Parliament and of the Council and Directive (EU) 2020/1828 of the European Parliament and the Council, and repealing Directive 2001/95/EC of the European Parliament and of the Council and Council Directive 87/357/EEC.

[2] i.e. Directive 2001/95/EC of the European Parliament and of the Council of 3 December 2001 on general product safety (also known as the “General Product Safety Directive”) and the Council Directive 87/357/EEC of 25 June 1987 on the approximation of the laws of the Member States concerning products which, appearing to be other than they are, endanger the health or safety of consumers (also known as the “Food Imitating Product Directive”).

[3] GPSR, Preamble Para. (4).

[4] As mentioned in the explanatory note available on the EC website at https://commission.europa.eu/business-economy-euro/doing-business-eu/eu-product-safety-and-labelling/product-safety/general-product-safety-regulation_en (last accessed on 3 October 2024).

Direct vs. Indirect Damages: When Are Losses Indemnifiable Under Romanian Law?

In our practice, we often encounter the question whether clients should accept liability for indirect and contingent damages. Here’s a brief explanation as to why indirect damage cannot be enforced under Romanian law.

Concept

“Damages” (in Romanian, “daune interese” or “despăgubiri”) refer to the compensation that one expects to receive or may receive following a situation where they suffered a loss due to another person’s intentional or unintentional unlawful conduct. Understanding the concept of damages under Romanian law is crucial because it impacts and applies to all interactions within the business environment. From a simple non-disclosure agreement that covers damages for breach of confidentiality obligations to indemnification under an M&A deal, the concept remains consistent. Also, it is noteworthy that the concept of “damages” has applicability both in contract law and in tort law, with contract law allowing certain flexibility of the parties in what concerns damages quantification, the conditions needing to be met for indemnification etc.

Types of Damages in Romania

The Romanian Civil Code allows for the claiming of compensatory damages (in Romanian, “daune materiale”) and moral damages (“daune morale”). Both kinds need to meet the conditions for being awarded, as further detailed below.

Compensatory damages are the reparation in cash that the person causing the damage needs to pay back to the damaged party. For example, a party breaching an agreement may be held liable to pay compensatory damages to cover the actual loss suffered by the other party or the loss of opportunity suffered by the other party. Moral damages are the reparation in cash or otherwise for damages brought against the other party’s reputation, image etc. Moral damages are usually harder to quantify and their grounds harder to prove.

Prerequisites for Damages under Romanian Law

The rule under Romanian law is that, for a claim for damages to be admissible (i) the damage should be existing (not contingent); (ii) the damage should be the consequence of an unlawful action or inaction; and (iii) the person inflicting the damage should be at fault (intention or negligence).

The loss – which covers both the loss actually suffered (damnum emergens) by the party claiming damages and the benefit deprived of (lucrum cessans) needs to be (i) a direct result of the unlawful action or inaction – Romanian law does not allow indemnification for indirect losses; and (ii) certain – this means that the loss has already occurred or is certain to occur in the future.

Indirect and uncertain losses are not indemnifiable under Romanian law, as these losses do not meet the legal prerequisites for indemnification.

Conclusion

Understanding the concept of damages under Romanian law is essential for anyone engaged in business or legal matters in Romania. Whether dealing with compensatory or moral damages, it’s crucial to meet the legal prerequisites for a claim to be admissible, ensuring that the loss is direct, certain, and caused by unlawful conduct. While the flexibility in contractual indemnification allows some room for negotiation, Romanian law remains stringent in its exclusion of indirect and uncertain losses. By grasping these principles, parties can better navigate liability and protect their interests in both contractual and tortious matters.