L6: Free movement of establishment

Question 1

What is freedom of establishment?

Answer 1

The right to pursue activities as a self-employed person in another MS (e.g. conducting a business or practicing a profession) on a permanent basis

Question 2

Article 49

Answer 2

Freedom of establishment

Question 3

Is Article 49 & 56 capable of direct effect?

Answer 3

Yes

Question 4

Gebhard

Answer 4

allowing an EU national to participate, on a stable and continuous basis, in the economic life of a Member State other than his state of origin and to profit therefrom, so contributing to economic and social interpenetration within the Union, in the sphere of activities of self-employed persons’.

Question 5

Primary establishment

Answer 5

Setting up or managing a company in another member state

Question 6

What are the conditions for setting up a primary establishment? Cadbury Schweppes

Answer 6

1) Actual establishment of co in the host state
2) Pursuit of genuine economic activity

Question 7

Secondary establishment

Answer 7

Setting up agencies, branches, subsidiaries in another MS

Question 8

Commission v Germany (Insurance)

Answer 8

An office managed by the undertakings staff qualified as an establishment

Question 9

Stauffer

Answer 9

Immovable property indicated permanency . should be actively managed

Question 10

Article 18

Answer 10

Within the scope of application of the Treaties, and without prejudice to any special provisions contained therein, any discrimination on grounds of nationality shall be prohibited.

Question 11

Gebhard

Answer 11

Lawyer faced disciplinary proceedings for practicing in italy under the title avvocato in contravention of italian legislation

held: EU national must comply with relevant requirements, such as the use of a professional title

‘measures liable to hinder or make less attractive the exercise of fundamental freedoms guaranteed by the Treaty’ must be non-discriminatory, justified in the general interest, and suitable for and proportionate to their objective.

Question 12

Article 56

Answer 12

restrictions on freedom to provide services within the Union shall be prohibited in respect of nationals of Member States who are established in a Member State other than that of the person for whom the service is intended’.

Question 13

Meaning of services Art 57

Answer 13

Normally provided for renumeration (industrial, commercial and professional activities)

Question 14

Sager

Answer 14

Facts: Under German legislation, licences for the provision of legal services were available to patent agents but not to persons who, like Dennemeyer (who was based in the UK) offered only patent renewal services.

Held: The Court of Justice held that [Article 56] not only requires the abolition of discrimination on grounds of nationality but also restrictions that are ‘liable to prohibit or otherwise impede’ the provision of services. Such restrictions are compatible with [EU] law only where they are justified by imperative reasons in the public interest, equally applicable to national and non-national providers insofar as the interest is not protected by rules applying in the non-national provider’s state of origin, and proportionate.

Question 15

Schindler

Answer 15

Facts: UK Customs and Excise confiscated invitations to participate in a German lottery on the grounds that they contravened national lotteries legislation.

Held: The Court of Justice, finding that lottery activities constitute services, held that although the legislation applied without distinction to national and non-national lotteries, it was likely to ‘prohibit or otherwise impede’ the provision of lottery services and therefore infringed [Article 56]. Such legislation would, however, be justified by ‘overriding considerations of public interest’ (here, the protection of the consumer, the prevention of crime and fraud, and the restriction of demand for gambling), provided it was proportionate.

Question 16

Directive 89/48

Answer 16

mutual recognition of qualifications, on the basis that an individual who held a higher education diploma on completion of at least three years’ professional education and had undertaken the necessary professional training was entitled to pursue that profession in another Member State.

Question 17

Directive 2006/123

Answer 17

Services directive

Question 18

Justification for breach

Answer 18

grounds of public policy, public security, and public health

Question 19

Omega

Answer 19

Facts: German authorities made an order prohibiting simulated killing in the course of a laser game on the basis of the game jeopardising public order, with human dignity being one of the principles safeguarded.

Held: The Court of Justice held that the protection of human dignity constituted a ground of public policy which could justify the restriction on the freedom to provide services. In relation to whether the measure satisfied the requirement of proportionality, the Court held that as the prohibition concerned only commercial exploitation of the variant of the game which involved playing at killing people, the prohibition did not go beyond that necessary to attain the objective pursued.

Question 20

What is the difference between a service and an establishment?

Answer 20

A service is temporary provided for renumeration, an establishment is stable and continuous

Question 21

What factors are set out in Gebhard for determining whether a service is temporary?

Answer 21

duration, regularity, periodicity, continuity

Question 22

Commission v Germany (INSURANCE)

Answer 22

existence of infrastructure usually indicative of establishment

Question 23

Can the incorporation of companies/firms be treated differently in another ms?

Answer 23

if a co is formed in accordance with the law of a ms is must be treated in the same way as a natural person who is a national of a ms

Question 24

centros

Answer 24

can the danish restrict plc set up in england?
could only restrict for ORPI.
eu law can be used for establishing companies in another ms regardless of intention

Question 25

examples of indirectly discriminatory measures

Answer 25

licensing
registration requirements
double burden rules

Question 26

ex of services

Answer 26

medical services, education, tv service, lotteries, cable networksDo

Question 27

Does renumeration have to be paid directly?

Answer 27

skandia- no, can be via 3rd parties

Question 28

Scope of art 56

Answer 28

freedom to travel to provide services. receive, electronic

Question 29

Direct discrimination

Answer 29

less favourable treatment based on nationality

Question 30

Factortame

Answer 30

Fishing vessel could be registered and entitled to fish in british waters if vessels were british owned, managed, controlled, from within the UK = breach of 49

Question 31

Indirect discrimination

Answer 31

Rules that appear neutral but disproportionately affect foreign businesses

Question 32

Examples of restrictions of establishment

Answer 32

authorisation requirements, restricting no of establishments in an area, ad restrictions

Question 33

Can a breach of 49 be justified?

Answer 33

Derogations in art 52 & 62

Question 34

Examples of ORPI

Answer 34

gambling prevention
fraud prevention
fiscal cohesion
money laundering
safeguard of financial market

Question 35

Centros

Answer 35

Danish registrar refused co incorporation and used ORPI justification (protection of creditors)
blanket refusal was disproportionate
acknowledged fraud as an ORPI

Question 36

Carmen

Answer 36

argued ORPI for prevention of gambling addiction
encouraged development of other games posing higher risks of addiction
unsuitable as it was not consistent/systematic

Question 37

Gibraltar

Answer 37

justification of rule requiring reports of suspicious activity was justifiable on ORPI terrorist financing