C-39/75

2. Services — Freedom to provide services — Restrictions — Abolition — Obligation on the person providing the services to reside in the territory of a Member State — Unacceptable nature — Criteria

1. The restriction to be abolished 2. The provisions of the EEC Treaty, in pursuant to Article 59 (1) of the Treaty particular Articles 59, 60 and 65, must include all requirements which are be interpreted as meaning that imposed on the person providing the national legislation may not, by means service by reason in particular of his of a requirement of residence in the nationality or of the fact that he does territory, make it impossible for not habitually reside in the State persons residing in another Member where the service is provided, which State to provide services, when less do not apply to persons established restrictive measures enable the within the national territory or which professional rules to which the may prevent or otherwise obstruct the provision of the service is subject in activities of the person providing the that territory to be complied with. service.

In Case 39/75

Reference to the Court under Article 177 of the EEC Treaty by the College van Beroep voor het Bedrijfsleven for a preliminary ruling in the action pending before that court between

1. ROBERT GERARDUS COENEN, residing at Brasschaat (Belgium),

2. BESLOTEN VENNOOTSCHAP GENERALE HANDELSBANK, established at the Hague (Netherlands),

THE COURT

composed of: R. Lecourt, President, R. Monaco and H. Kutscher, Presidents of Chambers, A. M. Donner, J. Mertens de Wilmars, P. Pescatore, M. Sørensen, A. J. Mackenzie Stuart and A. O'Keeffe, Judges,

Advocate-General: J.-P. Warner Registrar: A. Van Houtte

gives the following

JUDGMENT

Facts

the registers… shall only take place over the intermediary and that, as regards when it appears to the satisfaction of the the possibility of taking criminal or Sociaal Economische Raad … that the administrative proceedings against him, applicant resides in this country'. the absence of such requirement does not create difficulties which are peculiar Under paragraph (5) of the same Article, to intermediaries, the College did not where the intermediary is not a natural rule out the possibility that Articles 59 person, the condition of residence in the and 60 of the EEC Treaty might be Netherlands applies to the person interpreted as meaning that, once a responsible for the actual management of Netherlands national residing in the insurance activities. Belgium fulfils the 'other' conditions

abovementioned Law. At the same 'Should the provisions of the Treaty time the Raad informed the two establishing the European Economic abovementioned companies that in Community, in particular those of principle their registration had also to be Articles 59 and 60, be interpreted as deleted from the register, by reason of meaning that these should be held Coenen's place of residence. incompatible with them, a requirement such as that in Article 5 (1) (f) of the Wet As their objections to these decisions Assurantiebemiddeling, which provides were dismissed, the parties concerned that, where a natural person wishes to be brought an action on 17 May 1974 before entitled to act as intermediary within the the 'College Van Beroep voor het meaning of that statute law, he must Bedrijfsleven' (hereinafter referred to as reside in the Netherlands?' 'the College').

Treaty. After pointing out, inter alia, that the purpose of such a condition is Upon hearing the report of the merely to exercise effective supervision Judge-Rapporteur and the views of the

the reference to Article 5 (5) of this provision has no legal effect in the After adding that, in accordance with Community context. Title III of the abovementioned General Programmes which deals with These provisions are in fact contrary to: 'Restrictions', the prohibited restrictions — Article 48 of the Treaty, since their may result from provisions laid down by effect is to hinder freedom of law, regulation or administrative action as movement for workers within the well as from 'administrative practices', Mr Community, which is also laid down Coenen specifies that the principal by Article 1 of Regulation No problems which arise in this instance, 1612/68 of the Council (OJ 1968, L namely, 257); — the direct effect of the — Article 52 of the Treaty, since they abovementioned Articles of the imply a restriction on freedom of Treaty establishment; — the scope of Articles 59 and 60 of the — Articles 59 and 60 of the Treaty, Treaty which concern the question since they result in a restriction on involved in this instance, freedom to provide services within — the scope of Article 7 of the Treaty, the Community; — the rules in the Treaty which prohibit have already been settled by the case-law discrimination between the persons of the Court, in particular by the to whom it applies. judgment in Case 33/74 delivered on 3 December 1974 (van Binsbergen v After analysing all these articles and Bestuur van de Bedrijfsvereniging voor referring to the General Programmes de Metaalnijverheid, [1974] ECR 1299) adopted by the Council in 1961 for the in which, although it does not rule out abolition of existing restrictions on the possibility of providing for a freedom of establishment and freedom to condition of residence or establishment,

the Court subjects such a possibility to for the actual management of the the strict requirement that the condition business of an insurance intermediary in question be 'objectively justified' by carried on at the applicants' office must the need to ensure the 'general good'. be resident in the country which forms the basis of the decisions to delete the This is not however, so in the present names of the companies has in fact case. Mr Coenen refers to the reasons for become irrelevant in this instance. the Netherlands Law in question and in Moreover, this provision is incompatible the light of its underlying requirements with the directly applicable prohibition maintains that both he and the two on all discrimination between the companies which he manages still satisfy nationals of Member States established in all the conditions of the Article 5, apart a Community country, on grounds of from that concerning residence in the nationality or country of residence,

residence. Furthermore, the difficulty Articles 59 and 60 of the Treaty are pointed out by the Sociaal Raad, which directly applicable and may therefore be maintains that it is not clear that relied on by an insurance intermediary criminal proceedings may be brought and by any other person who provides against an intermediary who is resident services, where no specific provision in abroad, does not arise solely in the case the Treaty governs the activity in of intermediaries and therefore does not question. As, in these circumstances, the justify an infringement of the discriminatory provisions in the national abovementioned provisions of the Treaty. legislation governing the activities of an insurance intermediary are inapplicable, On the basis of these observations Mr a national of the EEC must be allowed to Coenen's conclusions are as follows: provide services in the Netherlands

This judgment acknowledges, delete his name is based, is incompatible first, the right of the Member States to with Articles 59 and 60 of the Treaty take appropriate measures in order to which have direct effect. It cannot, prevent a person who is providing therefore, be applied in Mr Coenen's case. services avoiding the professional rules which are applicable to him within the The companies are also entitled to have territory of that State. The difficulty their names retained on Register B. which such measures may create for the person providing the services in carrying The provision in Article 5 (5) of the Law out his particular activity cannot be in question that the person responsible imputed to discrimination but results

from the legal rules which any Member the light of all the facts set out in the State is entitled to lay down in order to order making the reference and the fact regulate, for the general good, the that the action also concerns two exercise on its territory of a particular companies established in the Nether­ trade or profession. Moreover, it is also lands which are managed by Mr Coenen, clear that in the exercise of such power it is necessary to consider the disputed the Member States are bound to limit condition of residence in relation to the their requirements to what is objectively provisions of the Treaty concerning: justified to ensure that the activity in — freedom of movement for workers question is carried out under what they (Articles 48 to 51), consider to be proper conditions and, in — freedom of establishment (Articles 52 this way, to make sure that the rules in to 58), question do not form an obstacle to the — freedom to provide services (Articles freedom to provide services which could 59 to 66). be avoided by the adoption of other measures capable of ensuring respect for (a) As regards the first point, the the organization of the trade or Commission points out that the profession in question. provisions of Article 48 of the Treaty are The French Government concludes that: relevant in the present case to the extent that those who actually manage an insurance-broking office who are obliged The obligation of residence imposed by virtue of the WA to reside in the upon insurance intermediaries by the Netherlands may be classified as Netherlands Law is justified as regards 'workers'. the provisions of Articles 59 and 60 (3) of the Treaty only if no other less restrictive obligation could provide the means of With the exception of the prohibition on all discrimination between workers on exercising the effective supervision provided for in the relevant rules, which grounds of nationality, the freedom of movement for workers under Article 48 consists inter alia in the inspection of books and documents and the imposition (3) of the Treaty implies the right 'to of penalties in the case of infringements.' accept offers of employment actually made'. This text implies a right on the The French Government concludes by part of the nationals of the Member expressing doubts as to the possibility States to accept and exercise paid that non-residence in the Member State employment whatever the Member State in which the service is provided is likely on whose territory the worker is to be to affect the possible deletion from the found. On this ground the duty to reside register of the name of the person in the territory of a Member State constitutes a restriction on the freedom providing the service, or the possibility of of movement for workers within the instituting judicial proceedings by that State. Community.

of the Court Article 52 of the Treaty is the Court of Justice of 3 December 1974 directly applicable, the Commission in Case 33/74, van Binsbergen v Bestuur draws a general distinction between van de Bedrijfsvereniging in which the residence and establishment. Article 52 Court not only acknowledged the direct applies to the freedom to establish a effect of Article 59 and the third permanent centre in a Member State in paragraph of Article 60 of the Treaty but which, or from which, economic also confirmed that the obligation on a

WA. In this case also the condition of reply must be given to the question residence may make it absolutely referred: impossible for the person concerned to carry out his activities in a particular 'Articles 48, 52, 59 and 60 of the EEC Member State if the same condition is Treaty must be interpreted as meaning laid down by several States. that a condition imposing a duty to reside permanently in the territory in (c) As regards the third point, the which the activity is carried on is Commission refers to the judgment of incompatible with these provisions.'

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'.

COENEN v SOCIAAL-ECONOMISCHE RAAD

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 do not apply to persons established within the national territory or which may prevent or otherwise obstruct the activities of the person 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.

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.

Costs

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.

On those grounds,

THE COURT

A. Van Houtte R. Lecourt

Registrar President

OPINION OF MR ADVOCATE-GENERAL WARNER DELIVERED ON 19 NOVEMBER 1975

My Lords, Article 5 (1) provides that, in order to be entered in one of those registers, a On 18 January 1952 there was enacted in person must show to the satisfaction of the Netherlands a statute, the 'Wet the Sociaal-Economische Raad that Assurantiebemiddeling' or 'WAB', (a) he does not carry on any business concerning insurance brokers and others incompatible with that of an carrying on business as intermediaries in insurance intermediary; the insurance field. This case, which (b) there is no reason to fear his bringing comes to the Court by way of a reference the profession into disrepute; for a preliminary ruling by the College (c), (d) and (e) he is not a minor or van Beroep voor het Bedrijfsleven, raises otherwise under disability and has a question as to the compatibility of a not been adjudicated bankrupt; provision of that statute with Community (f) he has an abode in the Netherlands. law, and in particular with Articles 59 and 60 of the EEC Treaty. The provision The College states in its Order for in question is one requiring persons who Reference that Article 5 (1) (f) must, in act as insurance intermediaries in the the light of other provisions of the WAB, Netherlands to reside there. be interpreted as meaning that the person in question must be established Article 4 of the WAB forbids anyone in the Netherlands, in the sense of (with immaterial exceptions) from acting having an office there, and must also as such an intermediary unless registered reside there.