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

Any restriction, even minor, of the free movement of capital is prohibited . It suffices that the measure by its very purpose, restricts free movement  irrespective of whether the beneficiaries have used the special rights granted . This is the case for a rule with regard to investment funds established in other Member States where it obliges them, if they wish to sell their units, to undergo the procedure for authorization within that national territory.  The restrictive effects must not be either too uncertain or too indirect to constitute an obstacle to the free movement of capital .

The measure must be imposed by a State acting as a public authority . This is the case of a regulation prohibiting the acquisition by persons resident in a Member State of securities of a loan issued abroad  or a private law agreement made the subject of a statute  or the creation of golden shares allocated to the State by an incumbent privatized energy supplier , or articles of association of a company which grant exorbitant rights to a Member State, adopted before its privatization . In contrast, a bilateral tax convention between two Member States is not contrary to Article 63 TFEU, insofar as European law does not prescribe general criteria for the distribution of competences between the Member States with regard to the elimination of double taxation within the EU . 

Case C-49/89 Corsica Ferries France v Direction générale des douanes françaises [1989] ECR 4441, LawLex200900000980JBJ.

Case C-515/99 Reisch v Bürgermeister der Landeshauptstadt Salzburg [2002] ECR I-2157, LawLex200700000592JBJ: measures laying down a procedure of prior notification-authorization for the acquisition of immovable property, restrict, by their very purpose, the free movement of capital.

Case C-128/08 Damseaux [2009] ECR I-6823, LawLex201100000637JBJ.

Case C-112/05 Commission v Germany [2007] ECR I-8995, LawLex200900000384JBJ.

Case C-39/11 VBV - Vorsorgekasse AG, Judgment of 7 June 2012, LawLex201200001492JBJ.

Case C-282/04 Commission v Netherlands [2006] ECR I-9141, LawLex200900001404JBJ.

Case C-478/98 Commission v Belgium [2000] ECR I-7587, LawLex200700001664JBJ: the prohibition of the acquisition by persons resident in a Member State of securities of a loan issued abroad may be assessed under Article 63 TFEU where it constitutes a measure taken in its capacity as public authority; Case C-112/05 Commission v Germany [2007] ECR I-8995, LawLex200900000384JBJ: a private law contract between operators constitutes a national measure falling within the scope of Article 63 TFEU where it has become the subject of a law.

Case C-478/98 Commission v Belgium [2000] ECR I-7587, LawLex200700001664JBJ.

Case C-543/08 Commission v Portugal [2010] ECR I-11241, LawLex201100000277JBJ.

Case C-212/09 Commission v Portugal [2011] ECR I-10889, LawLex201200000220JBJ.

155. Scope of the prohibition