Controversy over liberalisation of shop opening hours

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In June 2000, measures were adopted to liberalise shop opening hours in Spain, causing great controversy. The regional governments, the employers' associations representing small and medium-sized retailers and the trade unions oppose the reform and are preparing legal challenges and mobilisations to paralyse it. The CEOE employers' confederation and the employers' associations representing large retailers are in favour of the changes.

On 30 June 2000, the Spanish parliament passed a package of 70 liberalising measures in the form of five decree-laws. The package was intended to foster competition in order to stimulate economic growth without increasing inflation, an objective that was described graphically by Vice-President Rodrigo Rato: "we have made a bigger suit for the Spanish economy, which is becoming increasingly demanding." The measures were passed thanks to the conservative People's Party (Partido Popular, PP) government's absolute majority in parliament, with the rest of the parliamentary groups fiercely opposed to them. Some of the measures, and the procedure used to introduce them - decree-laws, which do not allow political debate - have led to a major dispute. The reforms affect such diverse areas as electricity, petrol, gas, telephony, retailing, technical inspection of vehicles, text books, sick leave (ES0007100F), pharmaceutical benefits, the internet and shop opening hours.

Liberalisation of shop opening hours

In 1996, supplementing existing regulation on retail, a new law established the possibility of total freedom of opening hours for retail establishments. This was the result of an agreement between the government and the regions (autonomous communities) and included a transition period, until January 2001, during which the regional governments could regulate retail opening hours. The law established the possibility of shops opening for a minimum of 72 hours per week and on eight public holidays a year, with the exception of tourist areas, which have full freedom. This meant that opening hours varied according to the region and the municipality.

In April 2000, the current government announced that it intended to increase retail opening hours to 90 hours a week from 09.00 to 00.00, to allow shops to open on 16 to 20 public holidays per year, and to introduce total freedom of opening hours for small shops. The government's intentions caused two months of controversy between the affected parties. Finally, the government chose to use a decree to liberalise opening hours for small shops (establishments of less than 300 square metres that do not belong to a chain), by giving them total freedom of opening hours and days. The decree also increases the opening hours of large establishments, allowing them to open on four more public holidays (up to now they could open on eight public holidays a year).

Opposition

The associations of owners of small retail establishments find the reform unacceptable. The Spanish Federation of Small and Self-employed Retailers (Confederación Española de Comercio Minorista y Autónomo, Cecoma), the Spanish Retailing Federation (Confederación Española de Comercio, CEC) and several regional entrepreneurial associations have announced lock-outs in protest at the more liberal opening hours. These associations claim that freedom of opening hours will force small shopkeepers into a situation of "slavery" and they fear that in the short term total freedom will be extended to large establishments. They accuse the government of benefiting foreign distribution companies, because they consider that opening on public holidays transfers market share from small retailers to large establishments. A study commissioned by the Spanish Association of Distribution of Self-Service Establishments (Asociación Española de Distribución de Autoservicios, Asedas), which represents medium-sized establishments, estimates this transfer of market share at ESP 300 billion a year. According to the same study, drawn up by the Carlos III University and the Autonomous University of Madrid, this may lead to the loss of between 34,000 and 65,000 jobs and will hardly affect prices or the retail prices index. These predictions are supported by the case of the Community of Madrid, where since 1996 establishments have opened on 12 public holidays a year and the numbers of jobs that have been lost and of shops that have closed are higher than in any other autonomous community. Furthermore, these employers' associations consider that this reform is an electoral "fraud", because these proposals were not in the PP's electoral programme, and one of its ministers, Josep Piqué, even promised that the legislation would not be modified during this legislature.

Shop opening hours are the competence of the autonomous communities, so the regional governments consider the reform to be an "invasion". The governments of Catalonia, the Basque Country, Andalusia, Asturias, the Balearic Islands and Castilla-La Mancha have commissioned studies to analyse the possible unconstitutionality of the measure and have presented appeals against the decree. The associations of small and medium-sized employers are supporting the regional governments in lodging appeals on the grounds of unconstitutionality. For the central government to override the competences of the regional governments, the issue must affect the general interest. The representatives of these communities fail to see how this can be applied to shop opening hours. The decree-law procedure can also be used only when an urgent necessity is detected; this is said not to be the case, because no sector of the population called for the reform. The opposition of the regional governments is also explained by the fact that small shopkeepers form an important part of their electoral base.

For the trade unions, the liberalisation of shop opening hours will worsen the working conditions and quality of life of the 2 million and more retail workers, 60% of whom are women hired on a part-time basis. The unions feel that these measures will increase the precariousness of employment and will make it more difficult to combine work and family life. All the trade unions in the sector - the Trade Union Confederation of Workers' Commissions (Comisiones Obreras, CC.OO), the General Workers' Confederation (Unión General de Trabajadores, UGT), the Federation of Trade Union Associations (Federación de Asociaciones Sindicales, FASGA) and the Federation of Independent Retail Workers (Federación de Trabajadores Independientes del Comercio, FETICO) - have signed a joint manifesto against the government's measures. They have announced the beginning of a campaign to sensitise workers, along with strikes and joint demonstrations, and they have called a general strike for 10 October. They also wish to reach an agreement with small shopkeepers in order to coordinate mobilisations in all the autonomous communities. In Madrid, some employers' associations and the trade unions announced a joint mobilisation for 18 July.

Support

The Spanish Association of Shopping Centres (Asociación Española de Centros Comerciales, AECC), representing small shopkeepers in shopping centres, and the National Association of Large Retail Establishments (Asociación Nacional de Grandes Superficies, Anged) consider that the new measure benefits both consumers and small retailers, although they are disappointed at the number of public holidays on which shops may open.

The Spanish Confederation of Employers' Organisations (Confederación Española de Organizaciones Empresariales, CEOE) is favourable to all the liberalising measures, including those on shop opening hours, because it considers them essential for the Spanish economy to grow further. It admits that many companies may be required to make major sacrifices, but it considers that the change will also involve new opportunities. Also, as on many other occasions (ES0006291N), CEOE is favourable to all measures that allow "market unity" in Spain, which is especially difficult to find in the retail sector because of the independent competences of the autonomous communities.

Commentary

The public has not shown a special interest in this question. According to a survey carried out by the Centre for Sociological Research (Centro de Investigaciones Sociológicas) in November 1999, only 4.6% of consumers always take advantage of opening on public holidays to go shopping, while 70.3% claim that they have never bought anything on a public holiday. At present, shops can open any 12 hours per day, from Monday to Saturday, which would seem enough for traders to offer a good service to consumers.

According to a report by the Autonomous University of Madrid, in France, where shops have greater freedom to open on public holidays, costs have increased by 15% and sales by 0.5%, which has affected prices: consumers have to pay more, whether or not they shop on public holidays. Furthermore, the transfer of market share to department stores may lead to a decrease in competition and the closing of small shops may lead to the desertion of large cities. Finally, the study finds that it is not clear whether the extension of working hours creates employment, and it may lead to an increasing instability of working conditions for workers in both small and large shops, according to how the employers use the possibilities of flexible working hours provided by legislation. It seems that a large part of the workforce needed for opening on public holidays can be met by current employees, who receive in exchange another day off, so they cannot share their leisure time with their relatives and partners. Furthermore, if the small retailers lose market share, the employment market will be less labour-intensive (it is estimated that 277 employees in a large supermarket can replace 318 in a supermarket and 1,557 traditional shopkeepers), and the jobs are often not of better quality.

France is having second thoughts on its policy in this area, because it is not at all clear that the change is for the better. One wonders what pressures the Spanish government is receiving to make it introduce this reform. (Clara Llorens, QUIT-UAB).

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