C-305/87

My Lords, 2. Articles 1, 2, 3, 4 and 5 of the Greek Emergency Law No 1366 of 2 to 7 September 1938, as amended, prohibit the execution of any deed relating to real estate or intangible property situated in the border regions or on an island or islet of Greece, or in a coastal area or an area in the interior of the country designated as a border region by decree, that is to say any deed by which the ownership or other real property right is transferred or a letting relationship or other relationship of obligation established with a natural or legal person, with the exception of the State or urban or rural districts. In 1. The single article of the Greek Presi­ order for the execution of such a deed to be dential Decree of 22 to 24 June 1927 valid, and only in respect of a natural provides that the acquisition by foreign person of Greek nationality or legal person natural or legal persons of ownership of real under the management of Greek nationals, estate or other real property rights, with the the person concerned must produce an exception of mortgages, in respect of attestation from the Minister for Agriculture property situated in the border regions of issued subject to a proposal by a special the country is prohibited on pain of commission, certifying that there are no penalties and absolute nullity of the legal reasons of security to preclude the trans­ transaction in question. The penalties are action. Foreigners are not permitted to fines and / or imprisonment, as well as execute such deeds unless the decree desig­ removal from office in the case of notaries nating the area as a border region is involved. The same penalties are laid down revoked by a fresh decree. in respect of the prohibition against letting or any other form of assignment to such persons of the right to use urban real property situated in the border regions of the country for a period of more than three years. Under that article it is also prohibited, subject to the penalties specified, to let or to assign in any form whatsoever the use of agricultural real property of any sort, including pasture, forests, lakes and fish reserves. That prohibition may only be lifted by a decision of the Ministers for the Interior, Agriculture and National Defence, 3. By various decrees, areas amounting to supported by an opinion given by a special approximately 55 % of Greek territory were commission. The regions regarded as border designated border regions for the purposes regions are those designated as such by of the Presidential Decree of 1927 and the decree. Emergency Law of 1938.

4. By an application lodged at the Court necessarily mean that Greece admits that the Registry on 5 October 1987, the Commission's argument is well founded and Commission claims a declaration that, by suggests that the Court should find against maintaining in force and applying certain the Commission. It does not, however, put provisions of its legislation, in particular the forward any argument to rebut the single article of the Presidential Decree of Commission's claims. At the hearing, for the 22 to 24 June 1927 and Articles 1, 2, 3, 4 first time, the Greek Government sought to and 5 of Emergency Law No 1366/1938, argue that the contested provisions might be in relation to transactions by foreigners who justified on security grounds in particular are nationals of Member States in respect of under Article 224 of the Treaty. In my view real estate situated in border regions, the that argument does not fall to be considered Hellenic Republic has failed to fulfil its obli­ by the Court because it was raised much too gations under the EEC Treaty, in particular late in the proceedings: Article 42(2) of the Articles 7, 48, 52 and 59 thereof. Rules of Procedure. In any event, however, the argument was not made good as to its substance by the vague references advanced at the hearing. The Greek Government also referred at the hearing to the efforts it had made and the difficulties it had encountered in amending the contested provisions in line 5. The Commission divides the Greek legis­ with Community law. However, it is well lation described above into two categories: established that such difficulties may not be the first (Presidential Decree of 22 to relied on by a Member State in order to 24 June 1927) applicable only to foreigners; excuse a failure to comply with Community the second (Emergency Law No 1366 of 2 law. to 7 September 1938) applicable on its face to foreigners and Greek nationals alike, but providing for the possibility for Greek nationals nevertheless to acquire land by going through the necessary administrative control procedure. The Commission argues that both regimes constitute discrimination 7. It should be said that in response to the on the basis of nationality, contrary to Commission's letter of enquiry in 1984 and Article 7 of the Treaty, and create an its reasoned opinion in 1985, the Greek obstacle to the free movement of persons Government already stated that amending and services (Articles 48, 52 and 59). The legislation was on the way. Indeed the Commission expressly declines to take a hearing in the present case, originally fixed position on whether the provisions are also for 6 December 1988, was postponed to incompatible with the provisions of the 14 March 1989 at the Greek Government's Treaty relating to the free circulation of request in order to allow time for the capital (Articles 67 et seq.). amending legislation to be adopted. However, such legislation still has not been adopted.

9. The right to own or deal with immovable property appears less immediately associated 10. The Commission also claims that with freedom to provide services than it is Article 48 of the Treaty is infringed. with the right of establishment. Nevertheless Article 48 has applied in Greece since it is plain that the national provisions in 1 January 1981, subject to the transitional question may seriously restrict the right of provisions laid down in Articles 45 to 47 of nationals of other Member States to provide the Act of Accession (Official Journal 1979, services in Greece which would involve L 291, p. 17). Those transitional provisions acquiring or dealing with immovable do not refer directly to Article 48 but only property. Indeed the 1961 General to certain Community legislation, in programme for the abolition of restrictions particular Regulation (EEC) No 1612/68 on freedom to provide services (Official on freedom of movement for workers Journal, English Special Edition, Second within the Community (Official Journal, Series IX, p. 3) included among the English Special Edition 1968 (II), p. 475). restrictions to be removed provisions which, Article 45(1) of the Act of Accession in respect of foreigners only, excluded or provides that Articles 1 to 6 and 13 to 23 limited the power to acquire, use or dispose of Regulation No 1612/68 'shall only of immovable property or rights therein; apply ... in Greece with regard to nationals and Council Directive No 67/43 (Official of the present Member States as from Journal, English Special Edition 1967, p. 3) 1 January 1988', and Article 45(2) defers required Member States to abolish the application of Article 11 of the regu­ restrictions on freedom of establishment and lation, but the transitional provisions make freedom to provide services in respect of no mention of Article 9(1) of the regulation activities of self-employed persons dealing which provides:

13. I consider that Article 48 of the Treaty does relate to housing and the ownership and renting of immovable property. Regu­ lation No 1612/68, Article 9(1) of which relates to housing, was adopted pursuant to Article 49 of the Treaty, which requires the 11. Application of Article 9(1) was thus not Council to adopt directives or regulations suspended by the aforesaid transitional 'setting out the measures required to bring provisions. It has therefore applied in about ... freedom of movement for Greece since 1 January 1981, with the workers, as defined in Article 48'. This is an effect that workers from other Member indication, at the very least, that equal States who were already in regular treatment with a Member State's own employment in Greece by 1 January 1981 nationals in housing matters is required in or who are already present in Greece in order to bring about freedom of movement regular employment after that date may for workers as defined in Article 48. Para­ benefit from the provisions of Article 9(1). graphs 15 and 16 of the Court's judgment The restrictions which the Greek legislation of 14 January 1988 in Case 63/86 in question imposes on the ownership and Commission v Italy [1988], although they renting of immovable property by foreigners concern the right of establishment, also are plainly incompatible with the provisions confirm the view that the right of free of Article 9(1), and the Commission would movement for workers entails a right of have been entitled to a declaration to that access to housing on the same terms as effect; but the Commission seeks a nationals of the host State. Furthermore, declaration of infringement not of those under the third paragraph of Article 48 provisions but of Article 48 of the Treaty. itself freedom of movement for workers entails the right 'to stay in a Member State for the purpose of employment in accordance with the provisions governing the employment of nationals of that State laid down by law, regulation or admini­ strative action'. Because the Greek restrictions on the ownership and renting of immovable property by foreigners in practice impede the right of a worker from another Member State to stay in Greece for 12. Since none of the legislation mentioned the purpose of employment, they can be in the transitional provisions relates to said to contravene Article 48. Therefore I housing matters, the application of consider that the Commission is entitled to Article 48 of the Treaty, in so far as it a declaration of infringement of Article 48 relates to housing and the ownership and of the Treaty.

15. Nevertheless the Commission has succeeded on the bulk of its submissions Accordingly , in my opinion, the Court should declare that , by maintaining in force and applying the single article of the Presidential Decree of 22 to 24 June 1927 and Articles 1, 2 , 3, 4 and 5 of Emergency Law No 1366 / 1938 in relation to transactions by foreigners who are nationals of Member States in respect of real estate situated in border regions , the Hellenic Republic has failed to fulfil its obli­ gations under Articles 48 , 52 and 59 of the EEC Treaty , and should award the Commission the costs.