C-43/93

2. That is the background to the questions * Original language: Italian. referred by the national court in these pro­ 1 — It should be borne in mind that the temporary posting of ceedings. The problem raised concerns spe­ (Community) workers has been taken into consideration by the Community legislature with regard to social security. cific aspects of the French legislation on the Article 14(1) of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to 'taking up of employment' in France by employed persons, to self-employed persons and to mem­ nationals of non-member countries. That bers of their families moving within the Community (see the consolidated version in Council Regulation (EEC) legislation — part of which was earlier con­ No 2001/83 of 2 June 1983, OJ 1983 L 230, p. 6) provides on this subject that: sidered by the Court in its judgment in Rush '(1)(a) A person employed in the territory of a Member State Portuguesa 2 — is set out below. by an undertaking to which he is normally attached who is posted by that undertaking to the territory of another Mem­ ber State to perform work there for that undertaking shall continue to be subiect to the legislation of the first Member State, provided that the anticipated duration of that work does not exceed 12 months and that he is not sent to replace 2 — Case C-113/89 Rush Portuguesa v Office National another person who has completed his term of posting.' d'Immigration [1990] ECR I-1417.

I - 3805

OPINION OF MR TESAURO — CASE C-43/93

3. Article L.341-2 of the French Labour essentially to oversee the employment of for­ Code provides that: eign workers wishing to come and work in France and of workers, whether or not French, already resident in France and wish­ ing to go and work abroad. The law confers on the OMI a monopoly on such opera­ 3 tions. Article L.341-9 of the Labour Code provides as follows: 'In order to enter France to take up paid employment there, all aliens must submit an employment contract countersigned by the administrative authorities or a work permit and a medical certificate, in addition to the documents and visas required by the interna­ tional conventions and regulations in force.'

I - 3806

VANDER ELST v OFFICE DES MIGRATIONS INTERNATIONALES

6. Under Article R.341-25, to fund its activ­ workforce of the undertaking includes some ities the OMI has at its disposal, in addition workers who are Moroccan nationals and to public grants and gifts, fees in respect of who have been continuously employed by expenses incurred ('redevances representa­ Vander Elst for some years; they are lawfully tives de frais') or lump-sum contributions resident in Belgium, have been issued with ('contributions forfaitaires') paid by 'em­ proper work permits in that country and ployers using workers' engaged through possess proper contracts of employment. the intervention of the OMI.

7. The penalty for breach of those provi­ sions is, inter alia, an administrative fine. 9. In April 1989 Mr Vander Elst sent a team According to Article L.341-7 of the Labour of eight workers, comprising four Belgians Code: and four Moroccans, to carry out work in Reims, France.

'Without prejudice to any legal proceedings which may be instituted against him, an employer who engages a foreign worker in It is established that the four Moroccan breach of the provisions of the first para­ workers were regularly employed by the graph of Article L.341-6 shall pay a special undertaking and had obtained from the contribution to the Office des Migrations French Consulate in Brussels the visa Internationales. The amount of such contri­ required to enter France and stay there as bution may not be less than 500 times the long as necessary to carry out the work. guaranteed minimum hourly rate laid down by Article L.141-8'.

and which imposes an administrative fine where such workers are employed even though they have not obtained the said work permits?' 11. In the action brought by Mr Vander Elst challenging that measure, the Tribunal Administratif, Châlons-sur-Marne, France, decided to stay the proceedings and refer to the Court two questions for a preliminary ruling which may be formulated as follows: Summary of the case-law relating to the free movement of services

12. It is clear that the issue in this case is the 'Where an undertaking established in one provision of services within the meaning of Member State provides services in another Article 59 et seq. of the Treaty. The eco­ Member State and to that end sends to the nomic activity in question is performed for latter State workers who are nationals of consideration by an undertaking established non-member countries and are lawfully and in a Member State other than that in which habitually employed by that undertaking, the services are to be provided. 4

does Article 59 et seq. of the Treaty preclude the application of national legislation such as the French legislation described above which makes the employment of those workers subject to:

13. Having said that, and before I consider whether the contested French legislation

— the requirement to apply to a national 4 — On the concept of 'services' within the meaning of Article 59 et seq., see most recently the judgment in Case C-275/92 body entrusted by law with a monopoly Schindler [1994] ECR I-1039.

I-3808

15. Moreover, the Court — restating in rela­ tion to the provision of services the princi­ ples of mutual recognition and proportional- ity long since established in relation to the It should first of all be borne in mind that free movement of goods — has held that the the Court has more than once stated that the free movement of services guaranteed by actual rationale of such provisions is essen­ Article 59 et seq. also implies the abolition of tially to be found in the need to further the restrictions ensuing from the application to a complete integration of the European market person providing services who is established by the abolition of national measures liable in another Member State of legislation, appli­ to hinder the cross-frontier provision of ser­ cable without distinction, in force in the vices. From that point of view, the Court has Member State in which the services are to be made it clear that Article 59, in the same way provided. as Article 48, is intended to facilitate the pur­ suit by Community citizens of economic activities of all kinds throughout the Com­ munity and precludes any national legisla­ tion which might hinder them when they wish to extend their activities beyond the territory of a single Member State. 5 As is made clear in the most recent case- 7 law, in the absence of harmonization of the rales applicable to services, or even of a sys­ tem of equivalence, the freedom guaranteed by the Treaty in this field may be restricted by the application of national rules which affect any person established in the national territory to persons providing services who are established in the territory of another 14. In accordance with that purpose, the Member State and who already have to sat- Court then gradually determined the scope of the rights arising from Article 59 et seq. of the Treaty. According to settled case-law, Article 59 of the Treaty prohibits not only 6 — See the judgments in Case C-360/89 Commission v Italy [1992] ECR I-3401 and in Case C-3/88 Commission v Italy overt discrimination on grounds of national­ [1989] 4035. Both judgments concerned cases of indirect dis­ crimination, that is to say based on criteria which, although ity but also all covert forms of discrimina­ the nationality of the provider of services was not a direct tion which, by the application of other crite­ factor, none the less led to the same result; in the first case, a quota in regard to public works contracts was reserved for undertakings having their registered office in the region where the work was carried out, while in the second case a quota in regard to public procurement contracts was reserved for mainly or wholly state-controlled companies. 5 — See the judgments in Case 279/80 Webb [1981] ECR 3305; in 7 — See, in particular, the judgments in Case C-28S/89 Stichting Case 143/87 Stanton v Institut National d'Assurances Sociales Collectieve Antenuevoorzienung Gouda and Others v Com- pour Travailleurs Indépendants [1988] ECR 3877 and in missanat voor de Media [1991] ECR I-4007 and in Case Case C-106/91 Ramrath [1992] ECR I-3351. C-353/89 Commission v Netherlands [1991] ECR I-4072.

(i) the rule does not give rise to any 17. In the present case, it is clear that the discrimination in form or substance effect of the national legislation at issue is to restrict freedom to provide services within the Community. As I said earlier, in its Rush Portuguesa judgment the Court has already 8 — See the judgments in Case C-154/89 Commission v Frunce [1991] ECR I-659, in Case C-180/89 Commission v Italy considered the French rules which require [1991] ECR I-709 and in Case C-159/89 Commission v Greece [1991] ECR I-691. undertakings established in other Member

I-3810

VANDER ELST v OFFICE DES MIGRATIONS INTERNATIONALES

States and intending to provide services in regular staff, do not therefore need to France, posting their own workers there, to approach employment bodies in the host approach the OMI and apply for work per­ country and comply with the relevant proce­ mits for the employees posted. In that dures; to impose such a requirement on regard, the Court stated that: them, as provided for in the French legisla­ tion at issue, thus constitutes a wholly unjus­ tified duplication of burdens and formalities liable to put them at a disadvantage in com­ peting with national providers of services.

I-3811

OPINION OF MR TESAURO — CASE C-43/93

have to engage any workers on the French from another Member State enjoying the labour market, they are not recipients of a freedom under Articles 59 and 60 of the service from the OMI and are not in breach Treaty to provide services.' of any monopoly.

19. The Governments which have intervened From this point of view, therefore, any dif­ in these proceedings have nevertheless ference in the legal status of the workers argued that the express findings of the Court posted — allegedly arising from the fact that in the Rush Portuguesa judgment cannot be one case concerns workers from a Member extended to this case. In Rush Portuguesa the State under a transitional scheme and the workers posted to France were in fact Portu­ other concerns workers from non-member guese and, although at the material time countries — seems to be totally irrelevant. under a specific transitional system Portu­ What matters is to ascertain whether, and if guese workers did not yet enjoy all the rights so how far, the application of the national conferred on Community workers, the mere rules relating to (the taking up of) employ­ fact that they were nationals of a Member ment leads to unjustified restrictions on the State could justify broader protection of the rights of Community undertakings guaran­ right of the business by which they were teed by Article 59 et seq. of the Treaty. employed freely to provide services.

The Portuguese workers were subject to a taking up employment are concerned. They transitional scheme which deprived them of are entitled to equal treatment only as far as the rights given to other Community work­ conditions of work or remuneration and ers by Articles 1 to 6 of Regulation (EEC) social security arrangements are concerned, as No 1612/68 of the Council of 15 Octo­ provided for in Articles 40 and 41 of the ber 1968 on freedom of movement for work­ Cooperation Agreement between the Euro­ 10 ers within the Community; in particular, pean Economic Community and the King­ 1 those workers did not receive equal treat­ dom of Morocco. 1 ment as regards the right to take up employ- ment (as provided for by Article 1 of the regulation) and could therefore be subjected to 'special recruitment procedures for for­ eign nationals' (in accordance with Arti­ cle 3(2)(a) of the regulation); on the other hand, those workers enjoyed full equality of treatment in the pursuit of employment (spe­ cifically, conditions relating to pay, dismissal, re-employment, social and tax advantages From the point of view of the application of and so on) as provided for by Article 7 et the French legislation on the right of aliens seq. of the regulation. Precisely because they to take up employment, the status of the did not fall within the rules set out in Arti­ Moroccans employed by Vander Elst would cles 1 to 6 of the regulation, the workers in therefore appear to be just the same as that question were not able to claim any original of the Portuguese nationals employed by right not to have applied to them the provi­ Rush Portuguesa. sions of the French Labour Code concerning the obligation to recruit through the OMI and to obtain work permits; however, they were able to claim a derived right in those terms, provided that they were employed by an undertaking established in another Mem­ ber State, as was the case in the circum­ stances before the Court.

The reasons relied on to justify the con- 23. However, even if we leave that consider­ tested legislation ation aside, the point is that the Member States do have at their disposal other means of controlling on their own territory the movements of nationals of non-member countries. The requirements of public policy and public security —· expressly provided for by Articles 48(3) and 56(1) of the Treaty — allow the Member States to subject the movements of those individuals to specific 21. The Governments which have intervened controls and permits, particularly by requir­ in these proceedings have also claimed that ing them to be issued with entry visas and the application of the French rules at issue is residence permits. Moreover, that was what in any event necessary in order to safeguard the French authorities had in view in provid­ certain requirements in the public interest ing for the compulsory issue of visas for connected in particular with controlling the nationals of various non-member countries, movements of nationals of non-member including in particular Moroccan nationals countries, the proper operation of the labour (in the case in point, moreover, it has been market, the protection of workers and com­ established that the Moroccan workers petition between undertakings. employed by Vander Elst had applied for, and obtained from the competent consular authorities, the visas required to enter France and remain there as long as was necessary to carry out the work).

Controlling the movements of nationals of non-member countries It follows that, from that point of view as well, the contested legislation merely creates a futile duplication of controls which are already effectively carried out by other, more appropriate, means.

That objection does not however appear to be valid. As I have already pointed out, and 26. In that regard, it should be borne in as the Commission has emphasized, an mind that in Rush Portuguesa the Court undertaking using its own workers to pro­ acknowledged that checks for such purposes vide services in another Member State does were lawful. The Court stated that: not in any way gain access to the host coun­ try's labour market. In that situation, work­ ers are engaged in the Member State of establishment in accordance with the proce­ dures there in force and are sent only tempo­ rarily to the country where the service is to be provided. Those findings are moreover 'However, such checks must observe the lim­ supported by the judgment in Rush Portu- its imposed by Community law and in par­ guesa, in which the Court, referring to 'a ticular those stemming from the freedom to temporary movement of workers who are provide services which cannot be rendered sent to another Member State to carry out illusory and whose exercise may not be made (...) work', pointed out that such workers subject to the discretion of the authorities.' return 'to their country of origin without at any time gaining access to the labour market of the host Member State.'

27. In this case, it seems to me that Court can develop further the implications of the statement just quoted, along the following lines: 25. Still in that connection, it has also been argued that if Article 59 et seq. is seen as granting an undertaking established in one Member State the right to send its own workers temporarily to other Member States in order to provide services there, the — For such checks to be effective, the authorities of the host country should in any national authority must be informed in event have the right to ensure that the under­ advance when workers from non- taking concerned is not abusing the right member

28. Finally it has been claimed that the national legislation is necessary to protect 30. Secondly, I must point out, for the sake of completeness, that the problem should not 12 — See the judgment in Webb, cited above. in any event arise in this particular case, since

I-3816

VANDER ELST v OFFICE DES MIGRATIONS INTERNATIONALES

the Moroccan workers employed by Vander regards social security arrangements. It fol­ Elst have valid employment contracts gov­ lows that, irrespective of the possibility of erned by Belgian law and, in accordance with applying national rules of public policy gov­ Articles 40 and 41 of the Cooperation erning the various aspects of the employ­ Agreement between the European Economic ment relationship to workers sent tempo­ Community and the Kingdom of Morocco, rarily to France, the application of the workers of Moroccan nationality are entitled Belgian system should in any event be con­ in the Member States to equal treatment vis- sidered to exclude any substantial risk of à-vis Community workers as regards condi­ workers being exploited or of competition tions of work or remuneration, and also as between undertakings being distorted.

Conclusion

31. In the light of those considerations, I propose that the Court give the following answers to the questions referred by the national court: