CJEC, November 26, 1975, No 39-75

1 By order of 18 April, 1975, received at the Court registry on 21 April 1975, the college van beroep voor het bedrijfsleven referred, under article 177 of the EEC treaty, a question on the interpretation of the provisions of the EEC treaty, and in particular on articles 59 and 60 concerning the freedom to provide services within the community.

2 This question has been raised within the context of an action concerning the application to a Netherlands national who resides in Belgium and has an office in the Netherlands, where he acts as an insurance intermediary, of the provisions of article 5 (1) (f) of the wet assurantiebemiddeling which provides that a natural person who intends to act as an intermediary within the meaning of this law shall be bound to reside in the Netherlands.

3 The grounds of the order making the reference state that the abovementioned provision must be understood to mean that in order to carry on the business of an insurance intermediary in the Netherlands a natural person must both reside in that country and have an office there.

4 The essential aim of the question referred is to discover whether the provisions of the treaty, in particular articles 59 and 60, must be interpreted in such a way as to prevent rules of internal law within the member states subjecting the provision of a service to a condition of residence such as that referred to by wet assurantiebemiddeling.

5 The first paragraph of article 59 of the treaty provides that restrictions on the freedom to provide services within the community, as defined in the first and second paragraphs of article 60 of the treaty, 'shall be progressively abolished during the transitional period in respect of nationals of member states who are established in a state of the community other than that of the person for whom the services are intended '.

6 The restrictions to be abolished pursuant to this provision include all requirements imposed on the person providing the service by reason in particular of his nationality or of the fact that he does not habitually reside in the state where the service is provided, which reside in the state where the service is provided, which do not apply to persons established within the national territory or which may prevent or otherwise obstruct the persons providing the service.

7 In particular, a requirement that the person providing the service must be habitually resident within the territory of the state where the service is to be provided may, according to the circumstances, have the result of depriving article 59 of all effectiveness, in view of the fact that the precise object of that article is to abolish restrictions on freedom to provide services imposed on persons who do not reside in the state where the service is to be provided.

8 It must be recalled in this respect that as regards the period during which the restrictions on the freedom to provide services were not yet abolished article 65 already stated that each member state shall apply such restrictions 'without distinction on grounds of. .. Residence' to all persons providing services within the meaning of the first paragraph of article 59.

9 Although, in the light of the special nature of certain services, it cannot be denied that a member state is entitled to adopt measures which are intended to prevent the freedom guaranteed by article 59 being used by a person whose activities are entirely or chiefly directed towards his territory in order to avoid the professional rules which would apply to him if he resided in that state, the requirement of residence in the territory of the state where the service is provided can only be allowed as an exception where the member state is unable to apply other, less restrictive, measures to ensure respect for these rules.

10 In particular, where a person providing services who is residing abroad has, in the national territory in which the service is provided, a place of business for the purposes of providing it, then, if such place of business is bona fide, the member state in question normally has effective means at its disposal for carrying out the necessary supervision of the activities of that person and to ensure that the service is provided in accordance with the rules issued under its national legislation.

11 In that case, the additional requirement that a person providing services in the territory of a state must also have a permanent private residence in that state is a restriction on the freedom to provide services which is incompatible with the provisions of the treaty.

12 On these grounds it must be concluded that the provisions of the EEC treaty, in particular articles 59, 60 and 65, must be interpreted as meaning that national legislation may not, by means of a requirement of residence in the territory, make it impossible for persons residing in another member state to provide services when less restrictive measures enable the professional rules to which provision of the service is subject in that territory to be complied with.

13 The costs incurred by the French government and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable.

14 As these proceedings are, in so far as the parties to the main action are concerned, in the nature of a step in the action before the national Court, the decision as to costs is a matter for that Court.

The Court

In answer to the question referred to it by the college van beroep voor het bedrijfsleven, by decision of that Court of 18 April 1975, hereby rules:

The provisions of the EEC treaty, in particular articles 59, 60 and 65, must be interpreted as meaning that national legislation may not, by means of a requirement of residence in the territory, make it impossible for persons residing in another member state to provide services, when less restrictive measures enable the professional rules to which provision of the service is subject in that territory to be complied with.