Concerns over the European Union's outline services directive are brewing into a potent political row in France that could influence the country's referendum on Europe's constitutional treaty.
The draft law, proposed by the European Commission a year ago, seeks to liberalise the Union's market for services by stimulating cross-border competition. It would allow companies and individuals to offer services in all 25 EU member states providing they abide by the laws of their home country.
Although numerous services - ranging from postal services and utilities to auditing and gambling - would be excluded, this principle has caused controversy.
Critics claim that many aspects of the French way of life would be jeopardised by the directive, which they fear in particular could lead to lower-paid workers from eastern Europe undercutting French public sector jobs.
On Friday, President Jacques Chirac expressed his worries about the directive, saying its evolution would need to be watched with "very great vigilance", according to the Elysée.
In a meeting with John Monks, the secretary-general of the European Trade Union Confederation, Mr Chirac stressed the importance of defending the social dimension to the European project. It was vital, he said, that the directive guaranteed social rights and cultural diversity.
France's opposition Socialist party this week called on the European Commission to withdraw the directive, which it claimed would jeopardise public and social services and workers' rights.
The "ultra-liberal" directive has also provided fresh ammunition for French opponents of the EU's constitution. France is expected to hold a national referendum in June on whether to approve the constitutional treaty.
Laurent Fabius, the deputy leader of the Socialist party, who opposes the constitution, said the directive provided ammunition for those people who thought the EU was evolving in the wrong direction.
Philippe de Villiers, a staunch rightwing opponent of the constitution, has also been using fears about the directive to fuel the No campaign.
"Every aspect of French daily life will be shaken up: wages, social protection, unfair competition, legal insecurity and outsourcing," he said in an interview on French radio. "The only way of rejecting the directive is to vote No to the European constitution."
Brussels has hailed the services directive as "potentially the biggest boost to the internal market since its launch in 1993", pointing out that services constitute more than 50 per cent of economic activity in the EU.
The law must be approved by both EU member states and the European parliament, but negotiations among national governments have so far reached only a preliminary stage.
