Thursday, 17 April 2008

EU TFEU: Common rules for services and establishment

The free movement of services shares many rules concerning the right of establishment in the Treaty on the Functioning of the European Union, as it does in the current Treaty establishing the European Community.

The pattern of this post is modified to take into account the publication of the consolidated Treaty of Lisbon, published 16 April 2008 by the Council of the European Union in the 23 treaty languages.



***

This is Article 62 of the Treaty on the Functioning of the European Union (TFEU), as amended by the intergovernmental conference (IGC 2007) in the Treaty of Lisbon (ToL) and consolidated by the Council of the European Union (document 6655/08; page 93), with the location of the provision added from the table of equivalences:

Part Three ‘Policies and internal actions of the Union’

Title IV TFEU ‘Free movement of persons, services and capital’

Chapter 3 ‘Services’

Article 62 TFEU
(ex Article 55 TEC)

The provisions of Articles 51 to 54 shall apply to the matters covered by this Chapter.

***

The IGC 2007 made no specific amendments to Article 55 TEC, but the provision and its referrals are renumbered. Cf. OJ 17.12.2007 C 306/55.

***

For the convenience of those who want to use the current TEC, we present the provision with the ones it refers to (from the latest consolidated version of the existing treaties, OJ 29.12.2006 C 321 E/63):

Article 55 TEC

The provisions of Articles 45 to 48 shall apply to the matters covered by this Chapter.

***

Article III-35 of the draft Treaty establishing a Constitution for Europe was essentially the same (OJ 18.7.2003 C 169/33):

Article III-35 Draft Constitution

Articles III-24 to III-27 shall apply to the matters covered by this Subsection.

***

Article III-150 of the Treaty establishing a Constitution for Europe followed the draft in style (OJ 16.12.2004 C 310/64):

Article III-150

Articles III-139 to III-142 shall apply to the matters covered by this Subsection.

***

No material change has been proposed during the reform cycle from the European Convention to the Treaty of Lisbon.

We have reached the last provision of Chapter 3 ‘Services’ in order to find out that we are told to go back to Articles 51 to 54 TFEU in Chapter 2 ‘Right of establishment’ to get things right.

With those readers in mind, who do not have the amended provisions at hand, we present the texts here (TFEU consolidation, pages 89 and 90):


Article 51 TFEU
(ex Article 45 TEC)

The provisions of this Chapter shall not apply, so far as any given Member State is concerned, to activities which in that State are connected, even occasionally, with the exercise of official authority.

The European Parliament and the Council, acting in accordance with the ordinary legislative procedure, may rule that the provisions of this Chapter shall not apply to certain activities.


Article 52 TFEU
(ex Article 46 TEC)

1. The provisions of this Chapter and measures taken in pursuance thereof shall not prejudice the applicability of provisions laid down by law, regulation or administrative action providing for special treatment for foreign nationals on grounds of public policy, public security or public health.

2. The European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure, issue directives for the coordination of the abovementioned provisions.


Article 53 TFEU
(ex Article 47 TEC)

1. In order to make it easier for persons to take up and pursue activities as self-employed persons, the European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure, issue directives for the mutual recognition of diplomas, certificates and other evidence of formal qualifications and for the coordination of the provisions laid down by law, regulation or administrative action in Member States concerning the taking-up and pursuit of activities as self-employed persons.

2. In the case of the medical and allied and pharmaceutical professions, the progressive abolition of restrictions shall be dependent upon coordination of the conditions for their exercise in the various Member States.


Article 54 TFEU
(ex Article 48 TEC)

Companies or firms formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Union shall, for the purposes of this Chapter, be treated in the same way as natural persons who are nationals of Member States.

"Companies or firms" means companies or firms constituted under civil or commercial law, including cooperative societies, and other legal persons governed by public or private law, save for those which are non-profit-making.

***

We see that some of the derogations (exceptions) from the right of establishment apply to the free movement of services: the exercise of public authority and the grounds of public policy, public security or public health.

There are legal bases for legislation and there is the principle of equal treatment of companies.

For a closer look, se for instance Chapter 22 ‘Freedom of establishment and to provide services’ in Paul Craig and Gráinne de Búrca: EU Law, Text, Cases, and Materials (Oxford University Press, 4th Edition, 2007).


Ralf Grahn