CJEC, 2nd chamber, October 1, 2009, No C-219/08

THE COURT (Second Chamber),

1 By its application, the Commission of the European Communities is seeking a declaration by the Court that, by requiring, in the event that workers who are nationals of non-member States are posted by Community undertakings in the framework of a provision of services:

- authorisation prior to the exercise of the economic activity;

- that the residence permit issued in the State in which the employer is established must be valid three months beyond the end of the service provided; and

- that a worker must have been in the service of the same employer providing the services for at least sixth months,

the Kingdom of Belgium has failed to fulfil its obligations under Article 49 EC.

National legal context

2 Under the Law of 30 April 1999 on the employment of foreign workers (Moniteur belge of 21 May 1999, p. 17800), as amended by the Royal Decree of 20 July 2000 (Moniteur belge of 30 August 2000, p. 29642), a foreign worker and his employer must obtain in advance a work permit and an employment permit, respectively. The first paragraph of Article 7 of that law provides, however:

'The King may, by a decree debated in the Council of Ministers, exempt such categories of foreign workers as He shall determine from the requirement to obtain a work permit.'

3 Article 2 of the Royal Decree of 9 June 1999 implementing the Law of 30 April 1999 on the employment of foreign workers (Moniteur belge of 26 June 1999, p. 24162), as amended by the Royal Decree of 6 February 2003 (Moniteur belge of 27 February 2003, p. 9583), provides:

'The following shall not be required to obtain a work permit:

...

14° workers who are not nationals of a Member State of the European Economic Area and who are employed by an undertaking which is established in a Member State of the European Economic Area and enters Belgium in order to provide services, on condition that:

(a) those workers have a right or permit to reside for longer than three months in the Member State of the European Economic Area in which they are resident;

(b) those workers are legally permitted to work in their Member State of residence, and such permission is valid for at least the length of time the service is going to be provided in Belgium;

(c) those workers are in possession of a lawful contract of employment;

(d) those workers have been in the service of the undertaking for a continuous period of at least six months;

(e) in order to ensure they return to their country of origin or residence, those workers are in possession of a passport and a residence permit that are valid three months beyond the end of the service provided.'

Pre-litigation procedure

4 The Commission took the view that the Kingdom of Belgium was in breach of Article 59 of the EC Treaty (now, after amendment Article 49 EC) with regard to the posting of workers who are nationals of non-member States and are employed by an undertaking established in a Member State other than the Kingdom of Belgium and sent that Member State formal notice, by letter of 25 March 1997, to which it replied by letter of 28 May 1997.

5 By letter of 9 September 1998, the Commission issued a reasoned opinion, to which the Kingdom of Belgium replied by letter of 30 November 1998.

6 After a further exchange of correspondence, the Commission, by letter of 13 July 2005, issued another reasoned opinion, to which the Kingdom of Belgium replied by letter of 7 October 2005.

7 Not being satisfied with the Kingdom of Belgium's reply, the Commission decided to bring this action.

Procedure before the Court

8 By order of the President of the Court of 9 October 2008, the Republic of Poland was granted leave to intervene in support of the form of order sought by the Commission. However, after informing the Court that it was withdrawing its intervention in this case, that Member State was removed from the register as an intervener in the case by order of the President of the Court of 15 January 2009.

9 By a document lodged at the Registry on 24 March 2009, the Commission informed the Court that, in the light of the adoption, and the communication by the Kingdom of Belgium, by letter of 12 June 2008, of the Royal Decree of 23 April 2008 amending Article 2, first paragraph, 14°, of the Royal Decree of 9 June 1999 implementing the Law of 30 April 1999 on the employment of foreign workers (Moniteur belge of 20 May 2008, p. 26202), it had withdrawn its action in so far as it concerned the second and third pleas it had raised.

The action

10 In its first plea, concerning the need to obtain authorisation prior to the exercise of the economic activity, which, following the Commission's partial withdrawal, became the sole plea in the action, the Commission complains that the Kingdom of Belgium unduly restricts the posting, by Community undertakings operating within the freedom to provide services, of workers who are nationals of non-member States, where they are posted from a Member State which does not apply the Schengen acquis in its entirety or where they are posted, for a period of more than three months, from a Member State which does apply the Schengen acquis in its entirety. In such cases, the Kingdom of Belgium requires workers wishing to be posted to Belgium to obtain in advance a visa or temporary residence permit under a cumbersome procedure designed to check whether the worker's posting complies with all the criteria of the case-law stemming from Case C-43-93 Vander Elst [1994] ECR I-3803).

11 The Commission considers that the restriction on the freedom to provide services arises, in particular, from the fact that the Belgian authorities require the workers concerned to produce documents to prove, first, that they are moving to Belgium in connection with a posting and that they are therefore exempt from the work permit requirement and, second, that they have sufficient means of subsistence, accommodation in Belgium and travel insurance, all this in order to obtain a visa.

12 The Kingdom of Belgium does not deny that it requires production of the evidence mentioned by the Commission. However, the evidence can be supplied by any legally permissible means and, in particular, by production of a posting certificate issued by the social security authority of the State of origin (Form E 101). The Kingdom of Belgium maintains that such evidence is intended only to show that a posted worker fulfils the criteria laid down in the Convention implementing the Schengen Agreement of 14 June 1985 between the Governments of the States of the Benelux Economic Union, the Federal Republic of Germany and the French Republic on the gradual abolition of checks at their common borders (OJ 2000 L 239, p. 19), signed at Schengen (Luxembourg) on 19 June 1990, with subsequent detailed amendments by the Common consular instructions on visas for the diplomatic missions and consular posts (OJ 2005 C 326, p. 1).

13 In that regard, the Court notes that it is settled case-law that Article 49 EC requires not only the elimination of all discrimination on grounds of nationality against service providers who are established in another Member State, but also the abolition of any restriction, even if it applies without distinction to national providers of services and to those of other Member States, which is liable to prohibit, impede or render less advantageous the activities of a service provider established in another Member State, where he lawfully provides similar services (see, in particular, Case C-244-04 Commission v Germany [2006] ECR I-885, paragraph 30).

14 However, where national legislation falling within an area which has not been harmonised at Community level is applicable without distinction to all persons and undertakings operating in the territory of the Member State concerned, it may, notwithstanding its restrictive effect on the freedom to provide services, be justified where it meets an overriding requirement in the public interest and that interest is not already safeguarded by the rules to which the service provider is subject in the Member State in which he is established and in so far as it is appropriate for securing the attainment of the objective which it pursues and does not go beyond what is necessary in order to attain it (Commission v Germany, paragraph 31, and case-law cited).

15 More particularly, it has already been held that a Member State may check that an undertaking established in another Member State, which deploys on the territory of the first-mentioned Member State workers who are nationals of a non-member State, is not availing itself of the freedom to provide services for a purpose other than the accomplishment of the service concerned (Commission v Germany, paragraph 40, and case-law cited).

16 In that context, the Court held that a requirement that the service provider furnishes a simple prior declaration certifying that the situation of the workers concerned is lawful, particularly in the light of the requirements of residence, work visas and social security cover in the Member State where that provider employs them, is a measure which, in principle, does not exceed what is necessary to prevent the abuse to which the implementation of the freedom to provide services may give rise (see, to that effect, Case C-445-03 Commission v Luxembourg [2004] ECR I-10191, paragraph 46, and Commission v Germany, paragraphs 41 and 42).

17 At the hearing the Commission stated that it did not intend to challenge that case-law. It maintained however that the fact that the Belgian authorities require the workers concerned to have a Form E 101 constitutes a more detailed procedure than the production of a prior declaration by the service provider.

18 According to the Kingdom of Belgium, production of a Form E 101 is in fact a less onerous procedure for the worker concerned than production of a prior declaration by the service provider. However, the Kingdom of Belgium expressly agreed at the hearing that, since the evidence required by the Belgian authorities that is described in paragraph 11 above may be supplied by any legally permissible means, it may also be supplied by production of a prior declaration by the service provider within the meaning of the case-law cited in paragraph 16 above.

19 In those circumstances, it must be stated that the Commission has not shown that the Kingdom of Belgium insists on an authorisation prior to the exercise of economic activity where workers who are nationals of non-member States are posted by Community undertakings in the framework of a provision of services.

20 In its plea, the Commission also complains of a lack of diligence by the Kingdom of Belgium in granting the visa applied for, since the visa is not issued until 48 hours after the person concerned has supplied the necessary documents. It also complains of a lack of transparency on the part of the Kingdom of Belgium. In particular, due to the failure to adopt an administrative circular, although one had been previously announced by the Belgian authorities, economic operators are unable to know in advance the requirements they must fulfil in order to provide services in Belgium.

21 In that regard, suffice it to say that such complaints, even if they were valid, do not show that the Kingdom of Belgium insists on an authorisation prior to the exercise of the economic activity.

22 The action must therefore be dismissed.

Costs

23 Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs, if they have been applied for in the successful party's pleadings. Under the first subparagraph of Article 69(5), on application by a party who discontinues or withdraws from proceedings, the costs are to be borne by the other party if this appears justified by the conduct of that party.

24 In the present case, the Commission has been unsuccessful as regards the single plea it maintained. The partial withdrawal by the Commission was the result of the communication by the Kingdom of Belgium of the Royal Decree of 23 April 2008 after the present action was brought.

25 In the circumstances of this case, each party must bear its own costs.

On those grounds, the Court (Second Chamber) hereby:

1. Dismisses the action;

2. Orders the Commission of the European Communities and the Kingdom of Belgium each to bear its own costs.