European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

1) Permanence and duration of the activity
The permanence and duration of the activity, which are characteristics of establishment, make it possible to distinguish it from the provision of services. Establishment implies possessing its own staff and a structure in the host Member State with a sufficient degree of permanence to provide a framework in which agreements are drawn up or management deci …

 Distinction between establishment and provision of services

1) Permanence and duration of the activity

The permanence and duration of the activity, which are characteristics of establishment, make it possible to distinguish it from the provision of services. Establishment implies possessing its own staff and a structure in the host Member State with a sufficient degree of permanence to provide a framework in which agreements are drawn up or management decisions taken with a view to providing the services in question on an independent basis . It consists in the creation of a professional base in the host Member State , establishment for an indefinite period  or in having the human and technical resources necessary for the provision of the services permanently present . All services that are not offered on a stable and continuous basis from a professional base in the Member State of destination constitute provision of services .

The temporary nature of the activities in question has to be assessed in the light not only of the duration of the provision of the services but also of its regularity, periodicity or continuity. This does not mean that the service provider may not set up the infrastructure necessary for the purposes of performing the services in question in the host Member State . Just as the right to acquire, use and dispose of immovable property on the territory of another Member State is a corollary of freedom of establishment, access to ownership and the use of immovable property is guaranteed by Article 56 TFEU for the effective exercise of the freedom to provide services . The fact that an economic operator established in one Member State provides services in another Member State over an extended period is not sufficient for that operator to be regarded as established in the latter Member State . No provision of the Treaty affords a means of determining, in an abstract manner, the duration or frequency beyond which the supply of a service or of a certain type of service in another Member State can no longer be regarded as a provision of services . “Services” can cover, inter alia, services which are provided over an extended period, even over several years, such as the collection of taxes .

The freedom to provide services which denotes the freedom to go to another Member State in order to receive or to benefit from a service, without being hampered by restrictions , requires a foreign component which is characterized where the place of establishment of the provider is different from that of the recipient . The mere allegation by a service provider that part of its customer base  comes from a Member State other than that of its establishment is not  sufficient to establish the existence of a cross-border situation . To benefit from the principle of the freedom to provide services, it is sufficient that a person providing the services offers those services in the territory of a Member State other than the one in which he is established, regardless of where the recipients of those services may be established . The concept of provision of services applies both to cases where the person providing services travels to the Member State of the recipient and to cases where he provides cross-border services without leaving the Member State in which he is established , even if the reason for which the recipient is staying in that State is not the service itself . This is particularly the case of services offered via Internet to recipients established in another Member State , the participation of citizens of a Member State to bets organized in another Member State, even if they relate to sporting events organized in the first State  or the organization of a lottery . However, where a professional established in one Member State moves to the  territory of the host Member State, in which he or she has had, in the  past, an establishment, in order to pursue his or her profession there  only on a temporary and occasional basis, the competent authorities of  that Member State are entitled, as is confirmed by recital 11 of  Directive No 2005/36, to verify the veracity of the statements of that  professional in order to ensure that he or she is not attempting to  evade enforcement of the national law relating to professions .

Case C-190/95 ARO Lease v Inspecteur der Belastingdienst Grote Ondernemingen te Amsterdam [1997] ECR I-4383, LawLex200900001047JBJ.

See, for example, Case C-55/94 Gebhard v Consiglio dell'Ordine degli Avvocati e Procuratori di Milano [1995] ECR I-4165, LawLex200900001056JBJ, for a German lawyer exercising his professional activity in Italy from his own structure in Milan.

Case C-243/01 Gambelli and others [2003] ECR I-13031, LawLex200900000896JBJ; Case 286/82 - 26/83 Luisi and Carbone v Ministero dello Tesoro [1984] ECR 377, LawLex200900001498JBJ; Case C-274/96 Bickel and Franz [1998] ECR I-7637, LawLex200900001367JBJ.

Case C-17/92 Federación de Distribuidores Cinematográficos v Spanish State [1993] ECR I-2239, LawLex200900000700JBJ.

Case C-311/19 BONVER WIN, Judgment of 3 December 2020, LawLex202100004707JBJ.

Case C-154/89 Commission v France [1991] ECR I-659, LawLex200900000613JBJ; Case C-70/95 Sodemare and others v Regione Lombardia [1997] ECR I-3395, LawLex200900001157JBJ; Case C-51/96 Deliège [2000] ECR I-2549, LawLex200700001592JBJ.

Case C-60/00 Carpenter [2002] ECR I-6279, LawLex200900001079JBJ.

Case C-211/08 Commission v Spain [2010] ECR I-5267, LawLex201100000500JBJ.

Case C-243/01 Gambelli and others [2003] ECR I-13031, LawLex200900000896JBJ.

Case C-42/02 Lindman [2003] ECR I-13519, LawLex200900000772JBJ.

Case C-502/20 TP v Institut des Experts en Automobiles and others, Judgment of 2 September 2021, LawLex202100005499JBJ.

Case C-221/89 The Queen v Secretary of State for Transport, ex parte Factortame [1991] ECR I-3905, LawLex200900002069JBJ; Case C-196/04 Cadbury Schweppes and Cadbury Schweppes Overseas [2006] ECR I-7995, LawLex200900001052JBJ; Case C-70/95 Sodemare and others v Regione Lombardia [1997] ECR I-3395, LawLex200900001157JBJ; Case 196/87 Steymann v Staatssecretaris van Justitie [1988] ECR 6159, LawLex200900001641JBJ.

Case 168/84 Berkholz v Finanzamt Hamburg-Mitte-Altstadt [1985] ECR 2251, LawLex200900001587JBJ.

Case C-171/02 Commission v Portugal [2004] ECR I-5645, LawLex200900000713JBJ; Case C-230/18 PI v Landespolizeidirektion Tirol, Judgment of 8 May 2018, LawLex201900000596JBJ: the operation of a massage salon within which sexual services are also offered falls within the scope of Article 49 TFEU, as prostitution constitutes a provision of services for remuneration whereas an activity consisting in the operation of a prostitution business falls within the freedom of establishment where carried out by the provider for an indefinite period and through a stable infrastructure.

Case C-55/94 Gebhard v Consiglio dell'Ordine degli Avvocati e Procuratori di Milano [1995] ECR I-4165, LawLex200900001056JBJ.

Case 305/87 Commission v Greece [1989] ECR 1461, LawLex200900002336JBJ.

Case C-171/02 Commission v Portugal [2004] ECR I-5645, LawLex200900000713JBJ.

Case C-215/01 Schnitzer [2003] ECR I-14847, LawLex200900001234JBJ.

Case C-357/10 Duomo Gpa Srl, Judgment of 10 May 2012, LawLex201200001759JBJ.

European Business Law

75. Distinction between establishment and provision of services

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

75. Distinction between establishment and provision of services

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise