C-113/89

RUSH PORTUGUESA

OPINION OF MR ADVOCATE GENERAL VAN GERVEN delivered on 7 March 1990 *

* Original language: Dutch.

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OPINION OF MR VAN GERVEN — CASE C-113/89

travail. As the representative of the French observations submitted to the Court, this Government made clear at the hearing, this question is raised in conjunction with the contribution is in the nature of an adminis­ aforementioned monopoly enjoyed by ONI trative fine. It amounts to at least 500 times as regards the recruitment and bringing into the guaranteed minimum wage laid down in France of foreign workers, and moreover Article L 141.8 of the code du travail. It relate to the (small) charge imposed under also appears from the documents before the Article L 341.8 of the code du travail, Court that the total amount of the fine which is to be paid on the renewal of a imposed on Rush amounts to approximately permit. I shall come back to this question FF 1.5 million. Rush applied to the national very briefly at the end of my reasoning (see court for this fine to be set aside. paragraph 22 below).

Nor does the main dispute appear to be 5. In the case of undertakings which, in concerned with the question whether a order to provide a service, wish to make use Member State may levy a contribution on of workers from Spain and Portugal, the grant of a permit. Nevertheless, the last account must be taken until 1993 of the part of the second question may be read in 2 rules contained in the Act of Accession. such a way that the national court is seeking to ascertain whether a Member State can 1 — Council Directive 68/360/EEC of 15 October 1968 on the make the provision of a service subject to abolition of restrictions on movement and residence within the payment of a specific fee to the immi­ the Community for workers of Member States and their families (OJ, English Special Edition 1968 (II), p. 485). gration service in connection with the grant 2 — Hereafter only Portuguese workers are mentioned. The of permits to the workers employed by the same remarks are, however, applicable to Spanish workers, regard being had to the identical wording of Articles 55 to supplier of services. To judge from the 58 of the Act of Accession.

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Anicie 215 of the Act of Accession imposes of Directive 68/360 may not be dissociated a restriction on the freedom, guaranteed by from those of Regulation No 1612/68 Article 48 of the EEC Treaty, of movement whose application is deferred pursuant to of workers between Portugal and the 10 Article 216 of the Act of Accession, the 10 'old' Member States. In accordance with 'old' Member States may derogate from this provision, Article 48 of the EEC Treaty those provisions to the extent necessary for is only to apply subject to the transitional the application of the provisions of provisions laid down in Articles 216 to 219 Article 216. of the Act of Accession. Article 216 of the Act of Accession provides that:

. . . The other Member States may maintain in force until 31 December 1992, with regard to . . . Portuguese nationals .. . , The first and second preliminary questions national provisions . . . making prior auth­ orization a requirement for immigration with a view to pursuing an activity as an employed person and / or taking up paid 6. On the basis of the provisions of the Act employment.' of Accession mentioned in the preceding paragraph, ONI applied to Rush the abovementioned provisions of the code du travail and, owing to the infringement The abovementioned Articles 1 to 6 of thereof, imposed on it the fine provided for Regulation No 1612/68 acknowledge, in in Article L 341.7. Before the national implementation of Article 49 of the EEC court, Rush argued that such a penalty was Treaty, the right of all nationals of a in conflict with the freedom to provide Member State to take up an activity as an services guaranteed by Articles 59 to 66 of employed person in another Member State the EEC Treaty whose application is not and to pursue such activity under the same restricted or postponed by the Act of conditions as the nationals of such Member Accession. In order to settle this dispute the State. In other words, those provisions give national court referred to the Court of effect to the principle of equal treatment Justice three preliminary questions which enshrined in paragraphs 2 and 3 of Anicie are reproduced in the Report for the 48 of the EEC Treaty. Hearing, at Section 1.4. In what follows I deal only with the first and second questions. As to the third question, which in my opinion is of no relevance in the deter­ Article 218 of the Act of Accession further mination of these proceedings, I shall briefly provides that, in so far as certain provisions come back to it in paragraph 23.

In essence, the Court is asked to clarify to also referred to by the parties to the main what extent the limitations on the free proceedings, is useful in order to show the movement of workers flowing from the Act background against which this dispute is of Accession may be applied to undertakings taking place. In the second and most within the Community which, for the important part, I shall examine the effect on purpose of providing a service, wish to go to this 'common law' of Articles 216 et seq. of one of the old Member States of the the Act of Accession (see paragraphs 12 to Community taking workers of Portuguese 18 below). In the third part, I shall draw

The questions raised by the national court literally concern the right of Portuguese suppliers of services to take Portuguese workers to an 'old' Member State. It should already be clear that the solution under Community law cannot be different The 'acquis communautaire' as regards the according to whether suppliers of services freedom to provide services from Portugal or from another Member State of the Community are involved, given the undiminished application of Articles 59 to 66 of the EEC Treaty and the fact that the aforementioned provisions of the Act of Accession contain only a restriction on the right of residence of Portuguese workers, whoever their employer is. 8. It must be stated straight away that the contested provisions of French law contain no (formal) discrimination with regard to non-French suppliers of services. In fact, the provisions in question impose an adminis trative fine on all employers who employ foreigners without a residence permit in

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other Member States. Thus, the Court held of mention that on the same date the Court in the Weco judgment (in which reference also delivered its judgment in the Frans- was made to the earlier Van Wesemael Nederlandse Maatschappij voor Biologische judgment) as follows: Producten case, in which it held that the same principle applied to the free movement of goods. Member States may not unnecessarily require an importer of goods 'the freedom to provide services, as one of to repeat technical or chemical analyses if such analyses have already been carried out the fundamental principles of the Treaty, 7 in another Member State. may be restricted only by provisions which are justified by the general good and which are applied to all persons or undertakings operating within the territory of the State in which the service is provided in so far as that interest is not safeguarded by the 9. The principles laid down in Webb were provisions to which the provider of a service further clarified in the Seco judgment of 8 is subject in the Member State of his estab­ 1982, whose factual background bears 4 lishment'. certain similarities with that of the present case.

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OPINION OF MR VAN GERVEN —CASE C-l 13/89

10. The Court's judgment applied the rule constitute a restriction on the provision of established in Webb that the provisions of services by an undertaking which makes use the Treaty relating to the freedom to of personnel which cannot avail themselves provide services do not merely prohibit open of freedom of movement for workers. The discrimination on the basis of the nationality criterion laid down in this connection in the of the provider of the services, but also any Seco case is that the application of a disguised form of discrimination which, national provision which at first sight although based on apparently neutral 10 applies without distinction, may not give criteria, in fact lead to the same result. rise to a disguised discrimination of The Court held that: suppliers of services established in another Member State. In Seco, such discrimination did exist because the obligation of 'Such is the case .

However, that employment. In such a case the legislation situation does not arise in the present case. of a State in which the service is provided Rules of the type of the French provisions in proves in economic terms to be more question do not entail any 'unnecessary onerous for employers established in repetition' of contributions paid or another Member State, who in fact have to requirements already fulfilled in the bear a heavier burden than those established Member State of origin. In that sense, H within the national territory'. foreign providers of services suffer no competitive disadvantage in relation to French suppliers of services. It was further made clear in the judgment that, although a Member State might completely refuse to allow the workers in question to enter their territory or to undertake paid employment there, they could not use those powers in order to impose a discriminatory burden on a supplier of services from another Member That distinction does not, however, deprive

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RUSH PORTUGUESA

must be necessary in order to ensure the to me to go without saying that a system of protection of the interests which they are prior residence permits can work more effi­ intended to safeguard. Furthermore, the ciently if observance thereof is also required Member States may not use their power in of employers of Portuguese nationals, matters of immigration and access to paid whether they be 'national' employers or employment in order to impose a discrimi­ employers from another Member State. In natory burden on suppliers of services estab­ most cases it will be for the employer to lished in another Member State. Moreover, apply for a residence permit and it may also in connection with the other freedoms be assumed that most employees of a guaranteed by the Treaty, it has been supplier of services operating in another accepted that Member States retain a certain Member State come to work in that power of regulation and sanction, but that Member State at the request of their the application of such national provisions employer. may not negate a freedom guaranteed by n the Treaty, or unnecessarily restrict it.

Against that background of the greatest possible observance of the freedom What is the rationale of Articles 216 et seq. guaranteed by the Treaty, I shall now of the Act of Accession? In the Court's examine which provisions, adopted on the case-law they are interpreted as an basis of the Act of Accession, by the 'old' exception (to be narrowly construed) to the Member States are permissible in relation to free movement of (Portuguese) workers, suppliers of services established in another which is intended to prevent a disturbance Member State. of the labour market in the 'old' Member States as a result of a massive influx of H Portuguese nationals seeking work . To this end, a transitional period was Influence of the Act of Accession on the introduced into the Act of Accession during freedom to provide services which the movement of employees is restricted.

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OPINION OF MR VAN GERVEN —CASE C-113/89

The movement of workers. There is therefore a Court has consistently stressed that the certain category of Portuguese workers to Community concept of a 'worker' is very whom the restrictions contained in the Act broad, and covers any national of a Member of Accession may not be applied. It is when State who actually and genuinely performs 15 it comes to determining this category that work in another Member State. In that opinions are sharply divided. connection it does not matter whether that work is carried out in the service of an undertaking which is active in other Member States or in the service of an undertaking which is established in the Member State where the work is carried

Article service of Rush, without however laying 216 is therefore based on the same broad claim to the right to establish themselves for an indefinite period as workers in France. 15 — See for example the judgment of 3 June 1986 in Case Moreover, their respective employment 139/85 Kemp/ime] ECR 1741, ¡n particular paragraphs 8 relationships remain strongly Portuguese in to 14, together with the reference to the judgment of 23 March 1982 in Case 53/81 Levin [1982] ECR 1035.

15. The most restrictive interpretation of the freedom to provide services is to be found in the submissions of the French 'Before the end of the second year of the Government. According to this interpre­ second stage of the transitional period tation, only employees of a supplier of provisions laid down by law, regulation or services who are in a 'position of trust' in administrative action . . . are to be the undertaking are excluded from the amended ... where such provisions ... are application of the Act of Accession because liable to hinder the provision of services by such persons are to be assimilated to the such nationals, or by staff possessing special supplier of services himself. Such persons skills or holding positions of responsibility are said, as I understand its argument, to accompanying the person providing the derive a right of residence as a supplier of services or carrying out the services on his 16 services from Directive 73/148/EEC. behalf.' According to the French Government, only a very limited number of persons are involved, namely those who exercise management functions in the undertaking and are authorized to commit the under­ taking as regards third parties. I am unable This provision affords an interesting point to share this narrow view, as will of comparison with the present case, immediately appear when I give my own because it is inspired by the idea that, if a assessment. It does insufficient justice to the supplier of services is effectively to be able principle of the freedom to provide services to use his right to provide services freely, he on which Rush is entitled to rely. must be allowed to operate with certain categories of personnel, even if that personnel does not come within the scope of the free movement of workers (the abovementioned General Programme was established in 1962, before the liberalization 16. An 'intermediate solution' is advocated of free movement of workers effected by the Commission whereby there would be pursuant to Articles 48 and 49 of the EEC excluded from the provisions of the Act of Treaty). The comparison cannot however be Accession staff possessing 'special skills' and taken too far because the provision cited staff holding 'positions of responsibility' in above was established at a time when the the undertaking providing the service. The freedom to provide services had not been Commission suggests in particular that realized either. In the present case, we are reference should be made to the 'General in a way one stage further: the freedom to Programme for the elimination of provide services is already fully applicable but encounters restrictions flowing from a 16 — Council Directive 73/148/EEC of 21 May 1973 on lhe (temporary) incomplete application of the abolition of restrictions on movement and residence within freedom of movement of (Portuguese) the Community for nationals of Member States with regard to establishment and the provision of services. workers. Article 4 gives a right of residence to nationals of a Member State who wish to provide services in another Member State. 17 — OJ, English Special Edition, Second Series IX, p. 3.

17. Nevertheless, the criteria contained in performance of which requires a special the General Programme indicate the right relationship of trust with the undertaking direction and I shall use them as the starting and/or the employer. In so far as the point for my own assessment. Those criteria presence of such persons in the Member are based on the assumption, which in my State in which the service is provided is view is correct, that the activity of an required for the efficient provision of the undertaking cannot be considered entirely service, that Member State cannot refuse separately from the persons who carry on them a residence permit (possibly limited to the undertaking's activity.

By 'special pensable for the efficient conduct of the qualifications' is meant a high degree of undertaking's activity. technical ability or a technical aptitude for a trade or profession which is rarely found and for which special technical knowledge is 20 required. The special nature of those qualifications may for example be reflected That seems to me to be the case with in the fact that the undertaking has made personnel who are entrusted with mana considerable investments in the recruitment gerial functions in the undertaking or who or training of the relevant workers, and may be regarded as belonging to the under must of course be assessed in the light of the taking's trusted staff or staff in a position of undertaking's activity and the nature of the responsibility. Contrary to the French service to be provided. Government's arguments, this does not mean only persons empowered to bind the undertaking with regard to third parties.

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RUSH PORTUGUESA

The fear that there might be a workers the 'old' Member States are obliged considerable, let alone a massive influx of to issue a residence permit. However, it Portuguese nationals seeking work which appears from the file that Rush did not may lead to a disturbance of the labour apply for a residence permit for any of the market in the old Member States is, in my workers whom he brought to France and view, not justified in relation to provisions that no such application was lodged by the intended to enable Community under workers themselves. The permissibility in takings, when providing services in another such circumstances of an administrative fine Member State, to have recourse to in the form of a 'special contribution', as personnel carrying out managerial functions was imposed by ONI, must be examined or with whom a relationship of trust exists separately for workers in respect of whom a and to avail themselves of workers who residence permit may be refused and such have special qualifications which are workers in respect of whom a permit can be essential for the service to be provided and

21 The Court inferred therefrom that number of workers is not required. This is, sanctions for non-compliance with however, the inevitable consequence of the formalities relating to the establishment of a option, taken in the Act of Accession, of right of residence by a worker protected by checking the movement of Portuguese labour during a transitional period, in order 21 — Sec lhe judgment of 3 July 1980 in Case 157/79 Pieck to prevent a disturbance of the labour [1980] ECR 2171, m particular paragraphs 11 lo 13, where reference is made to the judgment of 14 July 1977 in Case market in the 'old' Member States. 8/77 i<iSii/o[1977J ECR 1495

22. I now come back, as I said I would, to the question whether Member States may make the issue of a work or residence The principles laid down in those judgments permit to Portuguese nationals dependent seem to me capable of being transposed to upon the payment of certain fees by their the penalties which the employer faces for employer. not applying for (declaratory) permits on behalf of his workers. It follows therefrom in my view that a penalty such as that at issue in the main proceedings is not permissible: its purpose is in effect to Once again a distinction must be made protect the discretionary power of the according to whether or not workers are national authority to issue or refuse the involved to whom a permit can be refused. permit applied for. What would be As regards workers who were entitled to a permissible is, for example, a light penalty residence permit, reference may be made to imposed on the host country's own Article 9 of Directive 68/360, which nationals for failure to apply for, or renew, requires the Member States to issue the an identity document. documents in question, either free of charge or on payment of a fee not exceeding the dues and charges required for the issue of identity cards to a State's own nationals.

The third question clearance (see Articles 15 to 16 of the regu­ lation). The 'machinery for vacancy 23. By this question the national court seeks clearance' is an intra-Community procedure to ascertain whether the members of Rush's for placing workers which provides for the staff whose employment led to the impo­ exchange of information between the sition of a special contribution by the ONI employment placement services of the may be regarded as specialized personnel or Member States. Those provisions are of no personnel holding a position of trust within relevance to the present proceedings. the meaning of the annex to Regulation However, the definitions contained in the No 1612/68. abovementioned annex of the terms 'specialist' and 'the confidential nature of It is rightly pointed out by Rush and the the post' may be a useful guide in deter­ Portuguese and French Governments that mining the categories of workers whom a this annex (and Article 16(3) of the regu­ supplier of services may recruit on the lation to which it relates) applies only to the Portuguese market even before 1993 (see functioning of the machinery for vacancy paragraph 17 above).

Conclusion

24. I propose that the Court should reply to the questions raised by the tribunal administratif, Versailles, as follows:

In respect of other categories of Portuguese workers, the old Member States retain, until 1 January 1993, the power to make immigration for the purpose of pursuing paid employment subject to prior authorization and also to impose a requirement to observe such rules on suppliers of services who employ such workers. The infringement of those rules may not, however, be sanctioned by a penalty which is so disproportionate in relation to the seriousness of the infringement as to impair the freedom to provide services. The issue of such a permit may be made subject to the levying of a charge on the employer of those workers, provided that such a charge is levied on national employers and employers from another Member State alike and is not disproportionately high with regard to its purpose.'

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