MEPs vote in favour of controversial Services Directive

The European Parliament has voted through a controversial directive aimed at opening up the services market across Europe.

The resolution, which aims to remove red tape that hampers services firms from operating throughout the EU, was passed by 394 votes to 215 today.

Trade unions from throughout Europe have expressed concern that the measure will lead to an erosion in employment standards, with service-providers from low-cost member states undercutting their rivals in wealthier countries.

They were particularly concerned about the country-of-origin principle that would allow a company from one member state to operate in another while only obeying the labour laws of its home country.

However, MEPs today approved a series of amendments – including the scrapping of the country-of-origin measure - which they say will protect workers' pay and conditions.

Speaking after today's report, Labour Party MEP Proinsias de Rossa said he was happy with what was agreed.

"We've achieved a good balance," he said. "We've removed the country-of-origin principle and we have managed to ensure that collective agreements are respected in any delivery of services."