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Justifications to restriction of the Freedom to Provide Services…
Justifications to restriction of the Freedom to Provide Services
Introduction
A 51 and 62 TFEU exclude application of A49 and A56 to economic activities that involve the exercise of official authority
In addition, under A51 and 62 TFEU MS can also seek to justify restrictions of A56 on two basis
1) Pursuant to A52- permits derogations from freedom to provide and receive services on grounds of
public policy
public security
public health
2) Overriding requirements in the general interest
In both cases,restriction must be proportionate to policy objective pursued
Public Policy
In respect of public policy, the Court of Justice has held that, since this term permits MS to derogate from fundamental freedoms provided for under the Treaty, it must be interpreted
strictly
although they retain a margin of discretion to determine the measures necessary to protect public policy, MS can only rely upon this derogating provision to protect against genuine and sufficiently serious threat to a fundamental interest of society
Where one MS chooses stricter system of protection than others, this does not necessarily lead to conclusion that the restriction is disproportionate
When relying on A52
1) Must ensure that the restriction of A56 is necessary for protection of one of the fundamental interests of society
2) The restriction is suitable to achieve the objective pursued
3) There are no less restrictive means of achieving that objective
Omega
Court of Justice allowed Germany to prohibit laserdrome, a game tht involved participants simulating homicide on grounds of protecting public policy
The Court accepted that the MS entiteld to conclude that the economic activity was an affront to human dignity
Laara
Court of Justice accepted that a national rule that limited the right to operate slot machines to a single public body was justified on grounds of protecting public policy, including crime and fraud
Public Health
Court has examined in context of access to public services
Union citizens may travel to other MS to receive medical services and seek reimbursement from their own MS or insurance company upon their return
Pursuant to A52- MS or insurance companies permitted to make reimbursement SUBJECT TO THEIR PRIOR AUTHORIZATION of the medical procedures on the bais that the system is justified on grounds of protecting public health
In particular, Court of Justice has accepted hat such a system is justified on:
1) the risk of seriously undermining the financial balance of a social security sysem may constiute an overriding reason in the general interest capable of justifying an obstacle to freedom to provide services
2) Maintianing a balanced medical and hospital service open to all may also fall within the derogations on grounds of public health under A52 in so far as it contributes to the attainment of a high overall level of health protection
The conditions upon which prior authorisation based must be proportionate to objective pursued
Watts
HELD: A56 applied not obly in respect of private insurance schemes bu also publicly funded schemes, such as NHS
A refusal to gran prior authorisation must be based upon an objective medical assessment of the service recipient's medical condition including the degree of pain they are in and/or the nature of their disability at the time of the request
Where waiting list for particular patient inappropriately long- having regarding to the medical assessment of the service recipient, the MS cannot justify a refusal on authorization on public policy grounds
National Authorisation must be proportionate to object pursued
based on object, non-discriminatory criteria known in advance and do not permit arbitrary refusal
must be based on a procedural system which is easily accessible and capable of ensuring a request for authorisation will be dealt with objectively and impartially
Refusals to grant authorisation must be capable of being challenged
Justifications based on the Over-Riding Requirements of public Interest
In Order to justify restrictions of A56 on overriding requirements in the general interest, MS must satisfy a 4 part cumulative test
1) Measure mus tpursue a legitimate overrding requiremnt in the general interest
2) Measure must apply in a non-dscriminatory manner
3) Measure must be appropriate for securing attainment of that objective and
4) Measure mus not go beyond wha is necessary in order to attain that objective
The restriction of A56 must be proportionate to the objective pursued.
Overriding requirements= on-exhaustive list of policy objectives:
Protection of workers
the risk of seriously undermining financial balance of a social security system
the need to safegaurd the coherence of the tax system
the protection of workers
the need to guarantee the quality of skilled trade work and the need to protect those who have commissioner such work
Cases
Laval un Partneri
Court of justice held the restriction was not justified on basis of the public interest of protecting works
International Transport Workers Federation and Finnish Seamen's Union
The restriction on the freedom to provide services or the freedom of estab by collective action must be justified
Van Binsbergen
Court of Justice aggreed that in respect of professions, certain restrictions relating to the organisation, qualifications, professional ethics, supervision and liability required
However, such restrictions had to be proportionate to the objective pursued
The requirement that lawyers be resident in Holland was disproportionate, since objective could be achieved by imposing requirement lawyers had mailing address in Netherlands
Sager v Dennemeyer
German rule that required those engaged in patent renwal services to hold a license constituted a disproportionate restriction of the freedom to provide services
The service did not involve the provision of legal advance and was highly authomated
therefore restriction not necessary to protect consumers
Alpine Investments
Court of justice concluded that having regard to the risks for consumers in the futures commodities market, a prohibition of cold-calling proportionate to objective of consumer protection
Alternative methods of conacting consumers
Double Regulation
Criminal Proceedings against Webb
UK job agency manager was the subject of a prosecution for contravening a Dutch law that required suppliers of temp works in Holland to hold license
Court acknowledged the protection of workers was an overriiding requirement in the general interest and that requring such service providers to hold a license was suitable means of securing objective
HOWEVER- system disproportioantely infringed A56 as failed to have regard to whether the objective already secured by legislation applicable in service provider's MS of origin
thus hos MS cannot subject service provider based in another MS to unnecessary double regulation
Murphy v Media Protection Services Ltd
Court examined operation of IP as a justification
FACTS: Premier League films matches and sells the rights to broadcast them in an open competition
Broadcasts are willing ot pay a premium for territorial exclusivity and must ensure that their broadcasts are not available in other territories
ISSUE: Applicant bought Greek decoder and used it to watch Greek broadcast in the UK- cheaper than buying Sky broadcast
Premier Legaye said that the national measure was justified on grounds it protected IP- business model depended on territoiral exclusivity and that would be undermined if that national measure was not allowed
HELD: Effect of this charge was partitioning of EU into national markets
Contrary to the fundamental aims of teh Treaty and therefore was not reasonable remuneration
Therefore restriction on providing foreign decoders cannot be justified on basis of IP in these circumstances
Respect for Fundamental Rights
Final step in the process is that any limitation on the freedom to provide or receive services must respect the EU fundamentla rights of affected parties
ERT
FACTS: Greek government gave ERT exclusive rights to broadcast radio and TV channels
challenged by rival undertaking and the national court referred series of questions to the ECJ
ISSUE: Central issue in case- whether such a monopoly contravened the freedom to provide services
HELD: it needed tob be justified under A56
Must respect fundamental rights