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1 THE EU INTERNAL MARKET Michele Colucci Web site: European College of Parma Academic.

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Presentation on theme: "1 THE EU INTERNAL MARKET Michele Colucci Web site: European College of Parma Academic."— Presentation transcript:

1 1 THE EU INTERNAL MARKET Michele Colucci E-mail:info@colucci.eu info@colucci.eu Web site: www.colucci.eu www.colucci.eu European College of Parma Academic year 2011-2012

2 2 Article 3 TEU - to promote economic and social progress and a high level of employment and - to achieve balanced and sustainable development, in particular through the creation of an area without internal frontiers, through the strengthening of economic and social cohesion and through the establishment of economic and monetary union, to assert its identity on the international scene, in particular through the implementation of a common foreign and security policy including the progressive framing of a common defence policy to strengthen the protection of the rights and interests of the nationals of its Member States through the introduction of a citizenship of the Union, to maintain and develop the Union as an area of freedom, security and justice, in which the free movement of persons is assured in conjunction with appropriate measures with respect to external border controls, asylum, immigration and the prevention and combating of crime, to maintain in full the acquis communautaire and build on it

3 3 EU as a Custom Union Internal section - regulation of intra- Community trade: Elimination of custom duties and charges; Elimination of internal borders to facilitate four freedoms External section - regulation of trade with third countries: common custom tariffs; common commercial policy.

4 4 The Fundamental Freedoms 1. Freedom of movement for persons 2. Freedom of movement for services 3. Freedom of movement for capitals 4. Freedom of movement for goods

5 5 EC TREATY AND EU CITIZENSHIP (art. 20 TFEU). Every person holding the nationality of a Member State shall be a citizen of the Union. (art. 20 TFEU). Every citizen of the Union shall have the right to move and reside freely within the territory of the Member States, subject to the limitations and conditions laid down in this Treaty and by the measures adopted to give it effect. (art. 21 TFEU).

6 6 FREE MOVEMENT OF WORKERS Artt.45 - 48 TFEU. Workers have the right to: –; –accept offers of employment actually made; – –move freely within the territory of Member States for this purpose; – ; –to stay in a Member State for the purpose of employment; –. –to remain in the territory of a Member State after having been employed in that State.

7 7 THE EC TREATY Self employed persons: –(artt. 49-54 TFEU) and –Right of establishment(artt. 49-54 TFEU) and –Freedom to provide services (artt. 56-62 TFEU):. the right to take up and pursue activities as self- employed persons and to set up and manage undertakings.

8 8 CASE LAW OF ECJ: evolution Definition of «worker»: –A PERSON PERFORMS SERVICES OF SOME ECONOMIC VALUE FOR AND UNDER THE DIRECTION OF ANOTHER PERSON IN RETURN FOR WHICH HE RECEIVES REMUNERATION (Lawrie-Blum, C-66/85). «Community meaning»(Unger, C-75/63). Fundamental Principle: broad interpretation (Levin, C-53/81). Exceptions and derogations: strict interpretation (Kempf,C-139/85).

9 9 EQUAL TREATMENT BAN ON DIRECT DISCRIMINATIONS Art. 18 TFEU on the basis of nationality Art. 45 TFEU: –Access to employment –Pay –Employment conditions Association agreement, Co-operation agreement, and so on. SPORT: Balog case, Simutenkov, case

10 10 « COVERT DISCRIMINATIONS » NO « COVERT FORMS OF DISCRIMINATION which, by the application of other criteria of differentiation, lead in fact to the same result. (cause 152/73 Sotgiu) YES, only in case of « objective reasons »; proportionality test!

11 11 THE UEFA HOMEGROWN PLAYER RULE Homegrown: player trained by a club for 3 years when he is between 15 and 21 years old –2006/2007 4 up to 25 –2007/20086 up to 25 –2008/20098 up to 25 No discrimination on the basis of nationality.

12 12 Reverse discrimination National law v. EU law: National law v. EU law: –Different scope – different goals EU Law does not apply to purely internal matters.

13 13 Discriminatory act: Discriminatory act: –ordinary legislation, –Collective bargaining agreements, –Regulations of private associations,(Bosman, C-415/93): FIFA, UEFA, Limits to free movement: –Public administration; –Public order and security –Public health Discriminatory act and limit to free movement

14 14 TERRITORIAL SCOPE The EUROPEAN UNION: 27 Member States the 2+3+2 rule!

15 15 The case law of the ECJ Sport is subject to Community law in so far as it constitutes an economic activity within the meaning of Article 2 of the Treaty. Walrave case, C-36/74. Donà v. Montero case, C- 13/76(nationality clause). sports or economic activity? –C-51/96 Deliège case, C-176/96, Lethonen case, Meca – Medina case(doping).

16 16 THE BOSMAN case cause C -415/93 DAVID v. GOLIAH! Sport= economic activity= the end of transfer compensation Quid training ? The new FIFA regulations on Status and Transfer of Players

17 17 Freedom to provide services EC DIRECTIVE 2006/123/EC –Goal is to achieve a genuine Internal Market in services –A framework directive applying to wide-range of services –Provisions on: administrative simplification freedom of establishment freedom to provide services quality of services administrative co-operation

18 18 SCOPE Services –Any self-employed economic activity which is normally provided for remuneration Providers established in a MS –a natural person who is a national of a MS -a legal person established in a MS Certain provisions in the Directive relate to recipients –a natural person who is a national of a MS or who benefits from rights conferred upon him by Community acts -a legal person established in a MS BUT….

19 19 ACTIVITIES NOT COVERED Following activities are excluded from the scope: –non-economic services of general interest –financial services –electronic communication services and networks –transport services and port services –services of temporary work agencies –health care services –audiovisual and radio broadcasting services –gambling activities –activities which are connected with the exercise of official authority –certain social services –private security services –services provided by notaries and bailiffs –health care services –audiovisual and radio broadcasting services –gambling activities –activities which are connected with the exercise of official authority –certain social services –private security services –services provided by notaries and bailiffs

20 20 SIMPLIFICATION!!!!! MSs are obliged to examine all procedures and formalities applicable to access to a service activity and to the exercise thereof and, if needed, simplify them Points of single contact Procedures by electronic means

21 21 FREEDOM OF ESTABLISHMENT Actual pursuit of an economic activity for an indefinite period and through a stable infrastructure Provisions relating to –authorisation schemes –forbidden requirements which must be abolished –requirements which must evaluated and in certain cases abolished or replaced by less restrictive means

22 22 Freedom to provide services Characterised by the absence of a stable and continuous participation in the economic life of the host MS MSs are obliged to abstain from imposing their own requirements on incoming service providers, except –where justified by reasons of public policy, public security, public health or the protection of environment –legislation in question is covered by derogations provided for in Article 17 –case-by-case measures relating to the safety of services

23 23 Quality of services Information on providers, their services and the settlement of disputes Professional liability insurance and guarantees Commercial communications by the regulated professions Multidisciplinary activities

24 24 AUTHORISATION SCHEMES AND REQUIREMENTS Authorisation schemes are allowed only on certain conditions –non-discriminative –the need for authorisation is justified by an overriding reason relating to the public interest –proportionality Requirements are set for –conditions of the authorisations –the duration of the authorisations –authorisation procedures

25 25 FORBIDDEN REQUIREMENTS Forbidden requirements –nationality requirements for the provider, his staff, shareholders or members of the management or supervisory bodies –a requirement to be resident in the territory of that MS –a prohibition on having several establishments –restrictions on choosing between a principal or a secondary establishment or between different forms of secondary establishments

26 26 OTHER FORBIDDEN REQUIREMENTS –conditions of reciprocity –economic tests –the involvement of competing operators in the decisions of competent authorities –obligation to have financial guarantees or insurances from the MS in question –an obligation to have been previously registered or to have previously exercised the activity in the MSs in question

27 27 OTHER REQUIREMENTS Requirements subject to evaluation –quantitative or territorial restrictions –obligation for the service provider to take a specific legal form –requirements relating to the shareholding of companies –requirements reserving the provision of certain services to specific providers

28 28 OTHER REQUIREMENTS –bans on having more than one establishment in the territory of the same MS –obligations to have a minimum number of employees –obligations to apply fixed minimum or maximum tariffs –obligation on the provider to supply other specific services jointly with his service

29 29 FREE MOVEMENT OF CAPITALS Conclusions of the Madrid European Council on 26 and 27 June 1989: –the Liberalization of Capital Movements Corresponds to the First Stage of Economic and Monetary Union. –Necessary to take Full Advantage of the Benefits of the Single Market. But...Possibility of: – Restrictions – Safeguard Measures (for security and foreign policy reasons

30 30 FREE MOVEMENT OF GOODS Article 26 TFEU: The Union shall adopt measures with the aim of establishing or ensuring the functioning of the internal market The internal market shall comprise an area without internal frontiers, in which the free movement of goods, persons, services and capital is ensured in accordance with the Treaty

31 31 Obstacles to Inter-State Movement of Goods Recognized in the Treaty 1. Custom duties and charges having equivalent effect (Art. 28-30 TFEU): duties on border crossing and any other charges with equivalent effect 2. Discriminatory taxation (Art. 110 TFEU): taxes in excess of tax for similar domestic products 3. Quantitative restrictions on imports and exports (quotas) and all measures having equivalent effect (Art. 34-35 TFEU): MEE could be any public and private measure, including law, an internal regulation, decisions of a judge or a court, administrative rules and regulations giving discretion to discriminate (Irish Souvenirs case 249/81)

32 32 Quantitative Restrictions and MEE (Articles 34 and 35 TFEU) Quantitative restrictions = explicit restrictions such as quotas MEE = implicit restrictions such as a duty to obtain a licence to import or export Procureur du Roi v. Dassonville (case 8/74): All trading rules enacted by MS which are capable of hindering, directly or indirectly, actually or potentially, intra-Community trade are to be considered as measures having an effect equivalent to quantitative restrictions [para. 5] All trading rules enacted by MS which are capable of hindering, directly or indirectly, actually or potentially, intra-Community trade are to be considered as measures having an effect equivalent to quantitative restrictions [para. 5] Rule of reason: In the absence of a Community system…if a MS takes measures to prevent unfair practices…it is subject to the condition that these measures should be reasonable… [para. 6] Rule of reason: In the absence of a Community system…if a MS takes measures to prevent unfair practices…it is subject to the condition that these measures should be reasonable… [para. 6]

33 33 Categories of Measures Possibly Caught in Violation of Art. 34 TFEU by the Dassonville Formula 1. Discriminatory measures on the ground of nationality 2. Indistinctly applicable measures: so-called product requirements, related to the production and marketing of goods that apply without distinction to both foreign and domestic goods but it is usually more burdensome for foreign companies/goods (Casis de Dijon case 120/78) 3. Selling arrangements: category created by Keck case C-267/91 related to socio-economic measures as to how goods should be sold (manner of sale)

34 34 Cassis Principles : 1. The Rule of Reason: Certain measures, even if within Dassonville formula, will not breach Art. 34 TFEU if they are necessary (proportionality) to satisfy mandatory requirement (objective justification) relating in particular to the effectiveness of fiscal supervision, the protection of public health, the fairness of commercial transactions and the defence of the consumer 2. Mutual Recognition: There is no valid reason why, provided that goods have been lawfully produced and marketed in one MS, they should not be introduced into any other MS

35 35 Keck Proviso Selling arrangements are excluded from Article 34 TFEU (Dassonville formula) as long as they affect in the same manner, in law and in fact, the sale of domestic products and of those from other MS [para. 16]

36 36 Exceptions to Free Movement of Goods Public morality Public policy Public security Protection of health and life of humans, animals or plants Protection of national treasures possessing artistic, historic or archaeological value Protection of industrial and commercial property

37 37 THE EU INTERNAL MARKET MYTH OR REALITY? Some personal experience...


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