This Week in the Single Market — Brussels (#27, 2026)
Commission publishes Single Market banking report; Tax Omnibus proposal for simplification; EU-UK Gibraltar Agreement signed; New digital product passport registry rules; Council greenlights Italian VAT split payment extension.
July 12, 2026 to July 18, 2026
Commission publishes Single Market banking report; Tax Omnibus proposal for simplification; EU-UK Gibraltar Agreement signed; New digital product passport registry rules; Council greenlights Italian VAT split payment extension.
📋 In This Week's Newsletter
• 🇪🇺 European Commission
• ⚖️ EU Legislation
• 🤝 EU Council
• ✒️ EP Committee Work
European Commission
Commission sets out roadmap for EU banking sector integration
On 16 July 2026, Commissioner Maria Luís Albuquerque introduced the Commission's Communication on the competitiveness of the EU banking sector, delivering a plan to tackle remaining Single Market barriers in banking in line with the Savings and Investments Union (SIU) strategy. The diagnosis highlighted persistent market fragmentation, unequal transposition of Basel III standards, and excessive regulatory complexity—raising compliance costs to over €24 billion annually. The Communication proposes legislative measures to ease cross-border banking, promote capital and liquidity mobility within groups, and recalibrate deposit protection through a new EU-level mechanism, replacing the 2015 EDIS proposal. The Commission has announced its intention to amend the EU banking regulatory framework with a legislative package due in Q1 2027. Consultation with stakeholders and national authorities, including the ECB and EBA, informed these proposals, with feedback to shape the draft legislation.
ec.europa.eu | ec.europa.eu | ec.europa.eu
Commission delivers guidance for Google under Digital Markets Act
On 15 July 2026, the Commission issued two binding specification measures to Google under the Digital Markets Act (DMA), clarifying obligations on Android AI assistant interoperability (Art. 6(7) DMA) and sharing anonymised Google Search data with rivals (Art. 6(11) DMA). Google must allow alternative AI assistants access to Android device features and ensure eligible third-party search engines—including AI-based chatbots—receive anonymised data, starting in January 2027. Specification decisions are legally binding and apply to all core platform services in the EU. These measures follow consultation and take into account privacy safeguards, with further evaluation possible based on market developments.
Commission approves €63 billion French scheme for offshore wind energy
On 12 July 2026, the Commission approved a €63 billion State aid scheme for offshore wind under the Clean Industrial Deal State Aid Framework (CISAF). The programme supports construction and operation of eleven wind farms (up to 11.1 GW) via two-way contract for difference (CfD) mechanisms for a 25-year period. Aid will be distributed through competitive tenders, with the scheme expected to cover 10.6% of France’s annual electricity consumption. The approval replaces three earlier schemes and is in line with Article 107(3)(c) TFEU and CISAF sections 3 and 4.1.2.
Commission approves €659 million in German State aid for semiconductor projects
On 13 July 2026, the Commission authorised Germany's direct grants totalling €659 million for four first-of-a-kind semiconductor facilities, supporting value-chain activities in Baesweiler, Itzehoe, Weilburg, and Munich under Article 107(3)(c) TFEU and the principles of the European Chips Act. Aid recipients—Element 3-5, Vishay, KLA, and KETEK—commit to supply chain resilience, collaboration with research institutions, and priority supply during shortages. The projects are jointly financed by federal and Länder budgets. This brings to 18 the number of Commission decisions supporting advanced semiconductor investments in the EU since 2024, in line with the objectives of the Chips Act 2.0 proposal.
Commission reports progress in EU-India Trade and Technology Council
On 14 July 2026, the third meeting of the EU-India Trade and Technology Council (TTC) was held in Brussels, attended by Executive Vice-President Henna Virkkunen, Commissioners Šefčovič and Zaharieva, and Indian ministers. Both sides agreed to start formal Horizon Europe association negotiations, launch the EU-India Innovation Hub on electric vehicle charging, initiate a deep tech startup partnership, and intensify cooperation on semiconductors, AI, and resilient supply chains. The renewed TTC is a central pillar for strategic value chains and digital collaboration. Commissioners cited alignment with the Joint Strategic Agenda and noted ongoing progress towards the EU-India free trade agreement, aiming for FTA entry into force in 2027.
EU Legislation (Official Journal)
Council authorises Italy to apply VAT split payment until 2029
Council Implementing Decision (EU) 2026/1728 of 10 July 2026 extends Italy’s special split payment derogation under Directive 2006/112/EC until 30 June 2029. Italy may require VAT due on supplies to certain public authorities and state-controlled companies to be paid directly into blocked tax accounts. The extension aims to curb VAT fraud and preserves the requirement for priority treatment of refunds. Italy is requested to report to the Commission by September 2027 on refund timeliness and scheme effectiveness (OJ L 2026/1728, 15.7.2026).
Commission adopts implementing regulation for digital product passport registry
Commission Implementing Regulation (EU) 2026/1778 of 16 July 2026 sets the technical and operational rules for the EU digital product passport registry under Regulation (EU) 2024/1781. It defines roles for economic operators, value chain actors, and market surveillance authorities; prescribes identity verification, data storage, and transmission protocols; and provisions for an audit log system. The new rules cover all products requiring a digital product passport, including those under delegated acts for batteries, construction products, toys, and detergents (OJ L 2026/1778, 17.7.2026).
EU and UK sign Gibraltar agreement: Single Market and Customs integration measures
On 14 July 2026, the EU and UK signed the Agreement in respect of Gibraltar (OJ L 2026/1562, 14.7.2026), covering customs union, single market goods, coordination of social security and frontier worker rights, law enforcement, civil nuclear cooperation, and removal of border infrastructure. Council Decisions (EU) 2026/1732 and (Euratom) 2026/1564 approve signature and provisional application pending ratification. Provisions on customs and border checks will require implementation plans and administrative arrangements with Spain as the competent authority for customs matters.
eur-lex.europa.eu | eur-lex.europa.eu | eur-lex.europa.eu
Commission updates rules on due diligence for deforestation-linked products
Commission Implementing Regulation (EU) 2026/1565 of 13 July 2026 amends Implementing Regulation (EU) 2024/3084, specifying the submission of due diligence statements and simplified declarations for micro or small primary operators under Regulation (EU) 2023/1115. The Regulation introduces contingency protocols for information system outages and clarifies user access, record-keeping, and authority attribution, in effect from 17 July 2026 with delayed attribution rules to apply from 15 October 2026.
EU Council
Agriculture and Fisheries Council reviews presidency priorities and protein plan
At the Agriculture and Fisheries Council meeting on 13 July 2026, the Irish presidency presented its work programme, with priorities in livestock, rising input costs, and trade-related agricultural issues. Ministers discussed the Commission’s livestock strategy and protein plan, progress on generational renewal, and the integration of women in agriculture.
EP Committee Work
FISC Subcommittee hearing on Direct Tax Omnibus Proposal
On 14 July 2026, the FISC Subcommittee of the European Parliament held a public hearing on the European Commission's Direct Tax Omnibus proposal presented on 24 June 2026. Experts from SME Europe, Business Europe, and Tax Justice Network reviewed the proposal, which aims to simplify EU direct tax law—covering directives on parent-subsidiary, interest and royalties, corporate mergers, anti-tax avoidance, and dispute resolution—while maintaining anti-abuse safeguards for the Single Market. The Commission estimates overall compliance cost reductions of up to €8 billion per year, including €3.3 billion for SMEs. The hearing covered the balance between simplification and upholding effective anti-avoidance measures, impacts of the global minimum tax, and areas for further legislative strengthening.
