Freedom of Establishment and Provision of Services Flashcards
Rina Services
Rina Services brought an action to challenge an Italian law providing that certification bodies operating in the construction sector had to have their registered office in Italy, the CJEU was asked whether this was compatible with Article 49 and 56 TFEU and Directive 2006/123/EC. The Court responded that it was not: it restricted the freedom of certification services providers and obliges them to have their principal establishment in that territory
RATIO: The court highlighted that Directive 2006/123/EC sets out a list of ‘prohibited’ requirements, including those concerning the location of the registered office in the national territory. For these ‘prohibited requirements no justification can be given, including under Article 52(1) TFEU
Gebhard
German lawyer set up office in Millan; claimed he could take advantage of the Lawyers’ Service Directive which covered only services temporarily provided in other member States and not those who have become established; held he was established in Italy as pursuing profession on a ‘stable and continuous basis’
RATIO:
The test to apply when distinguishing establishment and services is the following: how stable and continuous is the activity in the host state? Factors to consider include: duration, periodicity, continuity and regularity
ECJ defined restrictions widely: ‘national measures liable to hinder or make less attractive the exercise of fundamental freedoms guaranteed by the Treaty. ‘
SPUC v Grogan
Student union claimed it was providing a service and therefore its service could not be banned; ECJ accepted abortion was a commercial service but in this case the Union had not distributed information on behalf of the English abortion service providers and there was no commercial motive in what the Student Union had done, it was merely seeking to ensure women were fully informed; State could ban its distribution of information
Marks & Spencer v Halsey
French and Belgium subsidiaries had suffered substantial losses; UK tax law allowed parent companies based in UK to claim tax relief for losses incurred by British subsidiaries, but not foreign subsidiaries; M&S challenged refused to grant them relief; held that exclusion of tax relief for subsidiaries in other Member States hindered the exercise by that parent company of its freedom of establishment.
RAITO:
Non-Discriminatory indistinctly applicable measures are banned under Art. 49; this will be the case where national laws discourage national companies from establishing themselves abroad.
Alpine Investments
Dutch investment companies cold-called potential customers in other Member States; Dutch law prohibited cold-calling by all businesses established in the Netherlands, including of people based outside; company argued tis was a restriction within Article 56 (offer of services) – law restricted the provision of services by Dutch established businesses.
RATIO:
Article 56 tFEU applies when no individuals actually move but services are provided purely by post, telephone, fac, internet etc to customers in another Member State
It is possible for individuals to rely on Article 56 when based in their own state.
Van Binsbergen
Dutch law stated that only persons established in Holland could act as legal advisors to social security cases; Dutch national in Belgium used Article 56 to challenge rule; held to be indistinctly applicable as it made no reference to nationality but limited freedom of lawyers from outside Holland.
RATIO:
Laws which require persons to be established in the country so as to be eligible for certain opportunities are indistinctly applicable measures which hinder the free movement by putting non-nationals at a disadvantage.
VanderElst
Workers concerned had permits to work in Belgium, which was the home state of the business; this was sufficient to allow them to be used for work on a services contract in France
RATIO:
Article 56 TFEU applies when an EU citizen or business providing services in a host State wishes to employ workers who are not themselves EU citizens.
The right to provide services includes the right to use one’s own workforce.
Luisi and Carbone
Both claimants purchased foreign currency for use abroad of an amount exceeding what was allowed by Italian law; argued they did so to see medical treatment and for tourism; held that there should be no restrictions to their right to seek services abroad
RATIO:
Article 56 TFEU also applied to recipients of services and includes for these individuals the freedom to go to another Member State in order to receive a service there, without being obstructed by restrictions, even in relation to payments. Tourists, persons receiving medical treatment and persons travelling for the purposes of education or business are to be regarded as recipients of services.
Geraets-Smits
ECJ had ruled that Article 56 applied to State medical services funded through insurance schemes. Thus, if a patient could not be treated in his home State without undue delay, he could seek treatment in another Member State at the expense of the insurance scheme
Watts
The claimant was a 72 yr old woman suffering from osteoarthritis; she was on a 12 month waiting list for hip replacement; sought treatment in France and requested reimbursement of the cost.
RATIO:
Confirmed Geraets-Smits principle applied to the NHS
Article 56 TFEU applies when nationals of one Member State travel to another Member State and receive services there; this includes State medical services funded through insurance schemes. If a patient cannot be treated in his home State without undue delay he can seek treatment in another Member State at the expense of the insurance scheme – this includes the National Health Service.
Cowan v Le Tresor Public
British national attacked and robbed while visiting France as a tourist; French authorities refused him criminal injuries compensation as he was not a French national; he invoked EU law; ECJ held he was entitled to compensation.
RATIO:
Article 56 TFEU applies when national of one Member State travel to another member State and receive services there. This includes the right to compensation on an equal footing as nationals, in line with Article 18 which prohibits discrimination based on nationality.
Reyners v Belgium
Under Belgian law, only Belgian nationals could be admitted to practice as lawyers; held to be a distinctly applicable measure; Belgium attempted to argue that the profession was connected with the exercise of official authority.
RATIO:
Article 49 bans distinctly applicable measures that hider free movement; these include regulations prohibiting non-nationals from working in certain sectors
Work of an avocat (consultation, legal assistance, representation in court) could not be considered work connected with the ‘exercise of official authority’
Commission v Italy
An Italian law made contracts for developing data-processing systems for public authorities only available to companies In which the State had a majority shareholding; no reference was made to nationality but this was held to be indistinctly applicable as Italian companies would be favoured.
RATIO:
Article 49 bans indistinctly applicable measures which might hinder free movement; allocating contracts to companies in which the State is a majority shareholder favours local industry and amounts to an indistinctly applicable measure.
Sodemare
Italian rules required certain activities to be carried out only by non-profits (i.e running homes for the elderly); argued this was a restriction on freedom of establishment as business would be discouraged from carrying out such activities if they couldn’t make a profit.
RAITO:
Non-discriminatory indistinctly applicable measures are banned under Article 49; this will be the case even if national companies are equally disadvantaged
Only businesses from other MS could use Art. 49 to challenge the Italian rules – Italian businesses would not have been able to do so.
Sager v Dennemeyer & Co Ltd
An English company provided patent renewal services in Germany, informing clients of when their patent renewal fees were due and paid them on their behalf if asked; in breach of German law which prohibited limited companies from carrying out this type of activity; only professionals acting int heir personal capacity were allowed to do so; amounted to an indirectly discriminatory measure
RATIO: Laws which limit which companies are able to provide services may be indirectly discriminatory where they hinder the freedom of movement of companies form other Member States.
