Summary W1. Services and
Establishment
Methodology Clips
Clip on Services and Establishment
To solve a case on establishment or services, there are three elements:
1. Scope
a. Does it fall under the scope of EU law and what legislation is applicable?
2. Restriction
a. What is the nature of the restriction?
3. Justification
Step 1: Scope
First question: is EU law applicable at all? To examine this, we must determine the personal
and material scope. Personal scope: is the person a national of an EU Member State? If yes,
then the personal scope is met. If the person is an EU citizen, we must ask (material scope) if
the actions have a cross-border element and is there an economic activity? If all the answers
are yes, EU law is applicable.
Which EU legislation do we use? We must distinguish between services and establishment.
Services have temporary character. Establishment concerns participation on a stable and
continuous basis (Gebhard §25).
In case of establishment, we turn to art. 49 TFEU + the Services Directive (lex specialis).
In case of services, we turn to art. 56 TFEU + the Services Directive (les specialis).
The scope of the Services Directive can be found in art. 2 and art. 3.
If the scope of the Services Directive is not met, you look at the Treaty provisions.
Step 2: Restriction
What kind of restriction are we examining?
- Direct discrimination (different rules depending on nationalities)
- Indistinctly applicable measure (formally the same for everyone, but restricts market
access for foreign providers)
Step 3: Justifications
Two types of justifications:
- Treaty exceptions, can justify both direct and indirect discrimination
o Those allow for several justification grounds
Workers: Art. 45(3) TFEU
Establishment: Art. 51, 52 TFEU
Services: Art. 62 (schakelbepaling), 51, 52 TFEU
o Exhaustive list
o Proportionality
Suitability for the goal it’s treatying to achieve
Necessity (less restrictive measure available)
, Stricto sensu (mostly a political consideration, a way of weighing
interests)
- Rule of reason exceptions
o Open-ended list of public interest grounds
o Must concern an indistinctly applicable measure (no discrimination)
o There can be no harmonization (a specialized Directive of Regulation)
o Proportionality
Suitability for the goal it’s trying to achieve
Necessity (less restrictive measure available)
Stricto sensu (mostly a political consideration, a way of weighing
interests)
o Crucial: Is the provider subject to similar regulation in the Member State in
which the person is established? If yes, that constitutes a dual burden and
cannot be justified
o Respect fundamental rights
Measure must not impinge excessively on other rights protected
under the Charter of Fundamental Rights and general principles of EU
law
Restrictions that are not directly or indirectly discriminating can still be prohibited when the
restriction is liable to hinder any fundamental freedom. These can be justified by ‘objective
justifications’/rule of reason. For the criteria of objective justifications, see Van Binsbergen,
but also Gebhard. Basically, the criteria are the same as provided in the knowledge clip, but
the following is added:
- Crucial: Is the provider subject to similar regulation in the Member State in which the
person is established? If yes, that constitutes a dual burden and cannot be justified
- Respect fundamental rights
o Measure must not impinge excessively on other rights protected under the
Charter of Fundamental Rights and general principles of EU law
Clip on Services Directive
The scope of Directive 2006/123
The directive (any directive) only applies to situations that its scope covers.
Art. 1(1): the Directive facilitates the exercise of the freedom of establishment for service
providers and the free movement of services.
Art. 1 also provides to what situations the Directive does not apply.
Art. 2 defines the personal scope: providers of services, established in a Member State.
Distinguish between natural and legal persons. A legal entity is a company, which must be
established in a Member State. A natural person is just a regular person.
Art. 2 also provides to what situations the Directive does not apply.
Art. 3 provides that more specific legislation trumps this Directive. Therefore, always check if
there isn’t a more specific EU act to follow.
Rules within the Directive
Substantive rules on the freedom of establishment are located in Chapter III.
Art. 14-restrictions (the blacklist) cannot be justified. Art. 15-restrictions (grey list) has the
possibility of being justified (by §3 of that article).
,Conclusion on questions on Services Directive
- Case
- Identify action + restriction
- In the Scope?
o Yes:
Make sure that the requirement is not on the blacklist, because in that
case no justification is possible
If a restriction is on the grey list, make sure that the restriction is
justifiable
Safety Net provision of Art. 18. In very exceptional circumstances, a
Member State may derogate from art. 16 and restrict the freedom of a
certain service provider.
For example: restriction of suspected criminal enterprises
o No:
Treaties/other Secondary Legislation
, Summary of the Literature W1
Chapter 18, The Single Market
2 Economic Integration: Forms and Techniques
There are different forms of economic integration, such as a customs union, a
common/internal market and an economic union. In a customs union, there is a set of
common rules about putting products from third countries on the market. The common
market implies not only free movement of goods (customs union) but also free movement of
the factors of production (like labour). Thirdly, the economic union, is controlled by a central
authority where monetary and fiscal policy is completely unified.
Different types of economic integration are positive integration and negative integration.
Mutual recognition amplifies negative integration (which is the main EU approach).
3 Pre-1986: Limits of Integration
Legislative contribution to integration can be conducted by harmonizing laws. Art. 115 TFEU
provides the legal basis that allows the EU to issue directives (etc.) on the establishment or
functioning of the internal market. This provision requires unanimity.
7 The Internal Market: Tensions and Concerns
- Consumer interests v. commercial powers
- EU free market v. weaker economies in the EU (they suffer short term)
- Economic v. social (worsened during economic crisis)
8 Conclusions
The SEA (Single European Act) made a significant contribution to the single market project
and European integration.
The focus in the 1980s and early 1990s was on the economic dimensions of the single
market. Legislative, judicial, and administrative initiatives contributed to the breaking down
of economic barriers to the single market.
In the mid 1980s, the internal market was conceptualized to embrace broader concerns
relating to social, environmental, and consumer policy.
Chapter 23, The Freedom of Establishment and to
Provide Services
1 Central issues
i. The freedom of establishment and the freedom to provide services concern self-
employed persons who move on a permanent or temporary bases between Member
States.
ii. The Treaty has primacy in the event of conflict over secondary law
iii. Art. 49-54 TFEU on freedom of establishment require the removal of restrictions on
the right of individuals and companies to maintain a permanent or settled place of
business in a Member State.
a. Establishment means ‘the actual pursuit of an economic activity through a
fixed establishment in another Member State for an indefinite period.’
Establishment
Methodology Clips
Clip on Services and Establishment
To solve a case on establishment or services, there are three elements:
1. Scope
a. Does it fall under the scope of EU law and what legislation is applicable?
2. Restriction
a. What is the nature of the restriction?
3. Justification
Step 1: Scope
First question: is EU law applicable at all? To examine this, we must determine the personal
and material scope. Personal scope: is the person a national of an EU Member State? If yes,
then the personal scope is met. If the person is an EU citizen, we must ask (material scope) if
the actions have a cross-border element and is there an economic activity? If all the answers
are yes, EU law is applicable.
Which EU legislation do we use? We must distinguish between services and establishment.
Services have temporary character. Establishment concerns participation on a stable and
continuous basis (Gebhard §25).
In case of establishment, we turn to art. 49 TFEU + the Services Directive (lex specialis).
In case of services, we turn to art. 56 TFEU + the Services Directive (les specialis).
The scope of the Services Directive can be found in art. 2 and art. 3.
If the scope of the Services Directive is not met, you look at the Treaty provisions.
Step 2: Restriction
What kind of restriction are we examining?
- Direct discrimination (different rules depending on nationalities)
- Indistinctly applicable measure (formally the same for everyone, but restricts market
access for foreign providers)
Step 3: Justifications
Two types of justifications:
- Treaty exceptions, can justify both direct and indirect discrimination
o Those allow for several justification grounds
Workers: Art. 45(3) TFEU
Establishment: Art. 51, 52 TFEU
Services: Art. 62 (schakelbepaling), 51, 52 TFEU
o Exhaustive list
o Proportionality
Suitability for the goal it’s treatying to achieve
Necessity (less restrictive measure available)
, Stricto sensu (mostly a political consideration, a way of weighing
interests)
- Rule of reason exceptions
o Open-ended list of public interest grounds
o Must concern an indistinctly applicable measure (no discrimination)
o There can be no harmonization (a specialized Directive of Regulation)
o Proportionality
Suitability for the goal it’s trying to achieve
Necessity (less restrictive measure available)
Stricto sensu (mostly a political consideration, a way of weighing
interests)
o Crucial: Is the provider subject to similar regulation in the Member State in
which the person is established? If yes, that constitutes a dual burden and
cannot be justified
o Respect fundamental rights
Measure must not impinge excessively on other rights protected
under the Charter of Fundamental Rights and general principles of EU
law
Restrictions that are not directly or indirectly discriminating can still be prohibited when the
restriction is liable to hinder any fundamental freedom. These can be justified by ‘objective
justifications’/rule of reason. For the criteria of objective justifications, see Van Binsbergen,
but also Gebhard. Basically, the criteria are the same as provided in the knowledge clip, but
the following is added:
- Crucial: Is the provider subject to similar regulation in the Member State in which the
person is established? If yes, that constitutes a dual burden and cannot be justified
- Respect fundamental rights
o Measure must not impinge excessively on other rights protected under the
Charter of Fundamental Rights and general principles of EU law
Clip on Services Directive
The scope of Directive 2006/123
The directive (any directive) only applies to situations that its scope covers.
Art. 1(1): the Directive facilitates the exercise of the freedom of establishment for service
providers and the free movement of services.
Art. 1 also provides to what situations the Directive does not apply.
Art. 2 defines the personal scope: providers of services, established in a Member State.
Distinguish between natural and legal persons. A legal entity is a company, which must be
established in a Member State. A natural person is just a regular person.
Art. 2 also provides to what situations the Directive does not apply.
Art. 3 provides that more specific legislation trumps this Directive. Therefore, always check if
there isn’t a more specific EU act to follow.
Rules within the Directive
Substantive rules on the freedom of establishment are located in Chapter III.
Art. 14-restrictions (the blacklist) cannot be justified. Art. 15-restrictions (grey list) has the
possibility of being justified (by §3 of that article).
,Conclusion on questions on Services Directive
- Case
- Identify action + restriction
- In the Scope?
o Yes:
Make sure that the requirement is not on the blacklist, because in that
case no justification is possible
If a restriction is on the grey list, make sure that the restriction is
justifiable
Safety Net provision of Art. 18. In very exceptional circumstances, a
Member State may derogate from art. 16 and restrict the freedom of a
certain service provider.
For example: restriction of suspected criminal enterprises
o No:
Treaties/other Secondary Legislation
, Summary of the Literature W1
Chapter 18, The Single Market
2 Economic Integration: Forms and Techniques
There are different forms of economic integration, such as a customs union, a
common/internal market and an economic union. In a customs union, there is a set of
common rules about putting products from third countries on the market. The common
market implies not only free movement of goods (customs union) but also free movement of
the factors of production (like labour). Thirdly, the economic union, is controlled by a central
authority where monetary and fiscal policy is completely unified.
Different types of economic integration are positive integration and negative integration.
Mutual recognition amplifies negative integration (which is the main EU approach).
3 Pre-1986: Limits of Integration
Legislative contribution to integration can be conducted by harmonizing laws. Art. 115 TFEU
provides the legal basis that allows the EU to issue directives (etc.) on the establishment or
functioning of the internal market. This provision requires unanimity.
7 The Internal Market: Tensions and Concerns
- Consumer interests v. commercial powers
- EU free market v. weaker economies in the EU (they suffer short term)
- Economic v. social (worsened during economic crisis)
8 Conclusions
The SEA (Single European Act) made a significant contribution to the single market project
and European integration.
The focus in the 1980s and early 1990s was on the economic dimensions of the single
market. Legislative, judicial, and administrative initiatives contributed to the breaking down
of economic barriers to the single market.
In the mid 1980s, the internal market was conceptualized to embrace broader concerns
relating to social, environmental, and consumer policy.
Chapter 23, The Freedom of Establishment and to
Provide Services
1 Central issues
i. The freedom of establishment and the freedom to provide services concern self-
employed persons who move on a permanent or temporary bases between Member
States.
ii. The Treaty has primacy in the event of conflict over secondary law
iii. Art. 49-54 TFEU on freedom of establishment require the removal of restrictions on
the right of individuals and companies to maintain a permanent or settled place of
business in a Member State.
a. Establishment means ‘the actual pursuit of an economic activity through a
fixed establishment in another Member State for an indefinite period.’
