C-398/95

OPINION OF MR LENZ — CASE C-398/95

O P I N I O N OF ADVOCATE GENERAL LENZ delivered o n 4 M a r c h 1997 *

1 — See the judgment in Case C-198/89 Commission v Greece * Original language: German. [1991] ECR 1-727.

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guide. The Court's reply was in the negative provide services. It has therefore referred the because it found that this was a breach of following question to the Court for a pre- Article 59 of the Treaty. liminary ruling:

'Is Article 37 of Law N o 1545/1985 which, 4. The national court points out that, under in the circumstances referred to therein, pre- Article 37, the legal relationship between scribes a mandatory legal form of employ- tourist guides and tourist agencies must be ment relationship between the parties — the deemed a relationship of employment if the legal form under which it is usual for the ser- conditions of Article 37 are fulfilled, with the vices of tourist guides to be provided in the result that the provisions of Greek legislation circumstances described in that article — apply. In this connection the court refers to contrary to Article 59 et seq. of the E E C the preamble to the measure and the aim of Treaty? If the answer is in the affirmative, is the legislature which, according to the that provision justified by reasons relating to national court, was to bring to an end once the general interest in maintaining industrial and for all the long-standing disputes peace in the sensitive area of the supply of between the parties to the collective agree- tourist services, in respect of which the ment. Greek State, as a country for which tourism is important, has a reasonable and justifiable interest in intervening by regulation?'

national law or its compatibility with Com- abusing the procedure under Article 177. 5 munity law. 2 According to settled case-law, However, there is no manifest abuse of that however, the question must be interpreted as kind here. On the contrary, it is quite con- meaning that the national court seeks to ceivable that the plaintiff in the main action, ascertain whether Article 59 et seq. of the the Association of Tourist and Travel Agen- EC Treaty must be construed as precluding cies in Greece, also represents foreign tourist the application of a provision — such as that and travel agencies established in that coun- in the present case — which, under the cir- try. Consequently the national court's ques- cumstances described above, mandatorily tions should not be regarded as inadmissible. classifies the contractual relationships of Moreover, in its observations the Commis- tourist guides as contracts of employment. 3 sion has stated its position on those ques- tions.

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museums and particularly important sites. In oral procedure, that in very rare cases Article other words, the interveners conclude from 37 might apply to foreigners. In this connec- the fact that a qualification is not absolutely tion it should be observed that, with regard essential for foreign tourist guides that to a possible infringement of the fundamen- Article 37, which applies only to qualified tal freedoms guaranteed by the Treaty, the guides, does not apply to foreign guides. scale of any such infringement is irrelevant. Even minor breaches are contrary to Com- munity law. 6

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provided for remuneration, in so far as they different location for the provision of are not governed by the provisions relating services, with the result that different types to freedom of movement for goods, capital of obstacle can be envisaged. and persons. In accordance with subpara- graph (d) of the second paragraph, 'services' include in particular activities of the profes- sions. Under the third paragraph, the person providing a service may, in order to do so, temporarily pursue his activity in the State where the service is provided, under the same conditions as are imposed by that State on its own nationals.

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of 'products' which are not 'goods'. 8 Conse- described above. The interveners also refer to quently Article 59 must apply in all cases the relationship of technical, economic and where a person providing services offers personal dependence which characterizes those services in a Member State other than such contracts for services in the context of that in which he is established, wherever the organized tours. At the same time, anyone recipients of those services may be estab- who is engaged simultaneously by more than lished. 9 one employer is deemed to be an employee. The Greek Government also observes that the Greek courts have on several occasions upheld the view that the contractual relation- ship between guides and tour companies in relation to organized tours constitutes an employment relationship under Greek law.

18. The question here, therefore, relates to a provision of services within the meaning of Article 59 et seq., so that a possible restric- tion of the freedom to provide services also falls to be considered.

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contract of employment. So far as concerns 22. For those reasons the provisions con- the Greek Government's reference to the cerning the freedom to provide services fact that the Greek courts have repeatedly apply to the present situation. reaffirmed that the contracts in question are covered by labour law, it must be observed that, as the statement makes clear, the courts have always arrived at this conclusion after examining individual cases by reference to specific criteria. Consequently it was not cer- tain from the outset whether the contract for services in question constituted an employ- 23. The next question is whether, in that ment relationship. situation, the guide's freedom to provide ser- vices for the tour company is restricted by Article 37. Since under the third paragraph of Article 60 of the Treaty, the services may be provided under the same conditions as are imposed on nationals, all discrimination on grounds of nationality is prohibited. In the present case there is no overt discrimination of that kind because Article 37 does not dis- tinguish according to a guide's nationality.

26. Nevertheless, it must be observed that Article 59 of the EC Treaty requires not only the elimination of all discrimination against a 27. In this connection the Greek Govern- person providing services on the ground of ment and the interveners observe that for- his nationality, but also the abolition of any eign guides may still accompany a group to restriction, even if it applies without distinc- Greece as freelance tourist guides, as was in tion to national providers of services and to fact established and required by the Court in those of other Member States, when it is its previous judgment. That is correct. How- liable to prohibit or otherwise impede the ever, it does not alter the fact that a foreign activities of a provider of services established guide who is qualified can work in Greece in another Member State where he lawfully only in the framework of an employment provides similar services. n As the Commis- relationship. This means that his freedom to sion and the plaintiff rightly observe, Article provide services is totally restricted because 37 imposes an absolute restriction on the he no longer has access to the market for ser- freedom of tourist guides from other Mem- vices in Greece. 1 3 ber States to provide services. 12 The fact that a contract for services concluded by a for- eign guide travelling with a group of tourists in Greece is mandatorily classified by Greek labour law as an employment relationship prevents the guide from 'working on a freelance basis and thereby denies him the opportunity to provide a service. The plain- 28. In this first situation account must also tiff points out that even if both parties would be taken of a service of another kind, the prefer a contract for the provision of ser- provision of which could be restricted, vices, no such contract can be concluded. namely the tour company's service to tour- The plaintiff adds, correctly, that in its previ- ists. In the previous case the Court held ous judgment the Court expressly referred that the supply of the service by the tour company could be impeded by the fact that it could not engage its own guides from its 11 — Sec the judgment in Case C-76/90 Säger [1991] ECR own country to accompany groups to 1-4221, paragraph 12. 12 — Sec the judgments in Case 205/84 Commission v Germany [1986] ECR 3755, paragraph 52; and Case C-101/94 Com- mission v Italy [1996] ECR 1-2691, paragraph 31. It is regarded as a negation of the freedom to provide services if 13 — Sec the judgment in Case C-384/93 Alpine Investments establishment is required in order to provide a service. [1995] ECR 1-1141, paragraph 35 et seq.

31. In the Commission v Greece case it was also found that tourists were adversely affected in that they could not choose between their foreign courier and a Greek guide. This does not appear to be the case 29. It should also be borne in mind that, as here because they can still choose a foreign recipients of the services of tourist guides, guide or a Greek guide who is not bound by tour companies could claim that there is a contract to a tour company. 17 At first sight restriction on the freedom to provide ser- the form taken by the contract for services, vices. With regard to the rights of recipients whether it is an employment relationship or of services, the Court has so far ruled that a relationship involving the provision of ser- they are free to go to another Member State vices, would not appear to affect tourists in order to receive a service there. 15 In the adversely. Should it have such an effect, previous judgment the Court also considered owing to Greek labour law and the corre- whether tourists were adversely affected, sponding terms of the contract of employ- which could be relevant only because they ment, it would be for the national court to were so affected as recipients of a service. 16 examine it and assess it accordingly.

34. In my view that argument cannot be accepted. Discrimination in relation to the freedom to provide services is not possible here for the simple reason that all qualified guides are absolutely prohibited from pro- viding services in connection with an orga- 33. Once again, there is no overt discrimi- nized tour. For this reason the right to pro- nation here. However, the plaintiff claims vide a service cannot be more restricted for that Article 37 leads to covert discrimination guides from other Member States than it is against foreign guides on the ground of their for Greek guides. The contention of the nationality. The Commission also mentions plaintiff and the Commission relates to the this possibility. Both proceed on the assump- work of guides in the context of a contract tion that, because the contract for services for services which has already been manda- takes the form of an employment relation- torily classified as an employment relation- ship, it is essential for the guide, as an ship. The issue in that regard is whether it is employee, always to be present at the tour possible for foreign guides to work in company's place of business or the place Greece as employees, that is to say their free- where the service is supplied. This means dom of movement under Article 48 of the that, to perform such a contract of employ- EC Treaty. ment in Greece, the tourist guide must trans- fer his residence to Greece. However, as only temporary activities in Greece are covered in connection with the freedom to provide ser- vices, performance of a contract of employ- ment in Greece under those circumstances would be impossible. For practical reasons it is impossible to set up a residence in Greece 35. According to the plaintiff and the Com- for temporary work and at the same time to mission, by mandatorily prescribing an maintain the principal residence in the home employment relationship, Article 37 creates State for the main activity carried on. an obstacle to the activities of foreign guides According to the plaintiff's submissions dur- in Greece, also with regard to freedom of ing the oral procedure, which were not con- movement. This reasoning is not entirely tested, this is all the more difficult in that clear. Even in the context of a contract there is at present no guaranteed monthly involving the provision of services the guide salary for tourist guides in Greece. This would be under an obligation to be present means that Article 37 leads to discrimination when providing the service. In that respect against guides who are not established in the existence of an employment relationship Greece. As these are usually nationals of does not entail an additional burden for for- other Member States, Article 37 therefore eign guides. Therefore it cannot be said that

38. Moreover, in this situation the guide's freedom to provide services is again 40. If a guide from another Member State restricted in that he cannot conclude a con- concludes a contract with a tour company tract for the provision of services with the established in a Member State other than

18 — Sec the judgment in Case C-415/93 Bosman [1995] ECR 20 — Sec the Bosman judgment, cited in footnote 18, paragraph 1-4921, paragraph 103. 103. 19 — Sec the judgment in Case 70/77 Simmenthal [1978] ECR 21 — Sec the Alpine Investments judgment, cited in footnote 13, 1453, paragraphs 57 to 58. paragraph 33 et scq.

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44. With regard to restriction of the freedom to provide services in general, it arises again in this case because the possibility for the guide to provide a service on the basis of Article 59 is limited unconditionally. In that case the tour company from another Mem- ber State may, as a recipient, rely on the free- dom to provide services. 25 Here the question is whether the Greek guide may also rely on his freedom to provide services as against the 41. Regarding the adverse effect, if any, for Greek State. The Court has consistently held tourists, I refer to my remarks concerning that this possibility exists where the services the first type of situation. 23

24 — Sec paragraphs 23 et seq. and 33 et seq. 22 — Sec paragraph 44. 25 — See the judgment in the Joined Cases Luisi and Carbone, 23 — See paragraph 17 et seq., particularly paragraph 31. cited in footnote 15, paragraph 16.

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are supplied for recipients established in 48. In this case likewise I cannot see any another Member State. 26 inconvenience to the tourists. If, for reasons arising in Greece which are unknown to the Court, there were any question of this, it would be a matter for the national court.

45. This is the case here because the service is supplied to the tour company established in another Member State. The important point, in other words, is that a cross-border factor is involved. Consequently it matters 49. Therefore it must be concluded that not that the service is supplied in Greece there are a number of situations and circum- because, so far as the actual provision of the stances in which Article 37 imposes a restric- service is concerned, it is the tourists who tion on the freedom of tourist guides or tour cross the border on the company's behalf in companies to provide services. order to receive the service provided.

must also pay contributions. Without them, are being infringed. These are fundamental the employer would be able to pay the guide Community rights which are binding not a higher salary, which would be necessary in only on the Community institutions but also order to enable a foreign guide, who would on the Member States when they implement have to move to Greece in order to work Community law, that is to say, particularly there, to do so. in transposing framework directives into national law or in the administrative applica- tion of regulations. 29 However, the present case concerns national legislation enacted b y a Member State, but not intended to imple- ment Community law. For that reason, it cannot be claimed that fundamental Com- munity rights have been infringed here. 51. The problem here is not that the guide may have to pay contributions twice, but that his legal relationship is mandatorily clas- sified as an employment relationship. N o doubt there are also guides working in Greece voluntarily. Under certain circum- stances they also have the problem of paying double social security contributions. How- ever, the problem is not caused by Article 37, because it not only arises in relation to the 53. As we have reached the conclusion that limited activities of tourist guides, which are Article 59 et seq. of the Treaty must be inter- regulated by Article 37, but affects every preted as precluding a provision such as worker who is liable to pay social security Article 37, the next question is whether an contributions in one Member State and is infringement of that kind may be justified. working temporarily in another. Rather, the This is the problem raised by the second part problem of double contributions is due to of the question submitted by the national other provisions which regulate such pay- court. ments (and it is questionable whether any such provision exists here). The plaintiff pro- ceeds on the assumption that Article 37 nec- essarily leads to a case of double payment but, as I have said, that is not so.

57. The Court has previously held 3 1 that compelling grounds of public interest include, for example, the protection of work- ers, 32 the protection of consumers, 3 3 the maintenance of the national historical and cultural heritage, 34 the proper appreciation of the artistic, historical and archaeological heritage and the widest possible dissemina- tion of knowledge of the artistic and cultural 55. All the parties to the present proceedings heritage of a country. 35 refer to that case-law, but reach different conclusions when applying the abovemen- tioned criteria. The national court itself observes that Article 37 is necessary and jus- tified on grounds of public interest in order to ensure industrial peace in the sensitive area of the provision of services in the form of organized tours, which are directly linked 58. The last-mentioned grounds were to the vital importance of tourism for the referred to by the Greek Government in the Greek economy. The interveners and the previous action. Here it also relied on those Greek Government are of the same opinion, grounds in the oral procedure, stressing the pointing out that Article 37 was introduced country's great cultural heritage, but only to to maintain industrial peace and security in explain that for such countries tourism is the sensitive area of tourist services, which is very important to the national economy. In crucial to the Greek economy. According to its written observations it also refers to the the interveners, security relates to the social security of those working in the tourist industry. Similarly, in the oral procedure the 31 — See the judgment in the Gouda case, cited in footnote 30, paragraph 14. Greek Government stated that Article 37 32 — See the judgments in Case 279/80 Webb [1981] ECR 3305, brings tourist guides within the protection of paragraph 19; Joined Cases 62/81 and 63/81 Seco [1982] E C R 223, paragraph 14; Case C-113/89 Rush Portuguesa Greek labour law. [1990] ECR 1-1417, paragraph 18. 33 — Sec the judgments in Case 220/83 Commission v France [1986] ECR 3663, paragraph 20; Case 252/83 Commission v Denmark [1986] ECR 3713, paragraph 20; and Case 205/84 Commission v Germany [1986] ECR 3755, paragraph 30. 30 — See the judgments in the Säger case, cited in footnote 11, 34 — Sec the judgment in Case C-180/89 Commission v Italy paragraph 15; Case C-288/89 Couda [1991] ECR 1-4007, [1991] ECR 1-709, paragraph 20. paragraph 13 et seq.; Case C-55/94 Gebbard [1995] ECR 35 — Sec the judgments in Case C-154/89 Commission v France 1-4165, paragraph 37; and Case C-19/92 Kraus [1993] ECR [1991] ECR 1-659, paragraph 17, and in the Commission v 1-1663, paragraph 32. Greece case, cited in footnote 1, paragraph 21.

59. The preamble to the contested Law merely stresses the unfavourable effects of the dispute on tourism in Greece and on the public interest. 61. With regard to the argument put for- ward by the Greek Government and the interveners that Article 37 was necessary in order to maintain industrial peace, the Com- mission contends that the maintenance of industrial peace cannot be a matter of public interest when it relates to the settlement of a collective labour dispute. There are no fur- ther submissions on this point. 60. The Court has no jurisdiction to inter- pret national law. However, it is clear from the foregoing that Article 37 was enacted to settle a long-standing labour dispute and thereby to prevent further negative repercus- sions for tourism and for the Greek economy. The Greek Government itself stated in the oral procedure that the measure was taken to ensure the proper functioning 62. In my opinion, the maintenance of of the economy. However, as the plaintiff industrial peace may indeed be acknowl- correctly observes, the Court has consis- edged to be a matter of public interest. H o w - tendy held that national economic objectives ever, in view of what has been said, it seems cannot constitute grounds of public order clear that industrial peace here was aimed at and of public interest 'which justify the as a means to an end, and the true purpose of restriction of a fundamental freedom pro- the measure was to ensure the proper func- tected by the Treaty. 36 This is not to deny tioning of tourism as a sector of the economy. Whether this is sufficient to find that there are compelling grounds of public 36 — See the judgments in the Gouda casc, cited in footnote 30, interest for restricting the freedom to pro- paragraphs 11 and 27 to 29, and Casc C-353/89 Commis- vide services seems to me to be extremely sion v Netherlands [1991] ECR 1-4069, paragraphs 45 to 48, with regard to compelling grounds of public interest justi- doubtful in view of the fact that national fying a restriction on the freedom to provide services; Case 352/85 Bond van Adverteerders and Others [1988] ECR economic interests alone are not enough to 2085, paragraphs 32 and 33, and Case C-17/92 Distri- buidores Cinematográficos [1993] ECR 1-2239, paragraphs justify any such power, and it remains to be 15 and 20 to 22, regarding grounds ofpublic policy within seen whether the means used by the Greek the meaning of Article 56 of the EC Treaty, justifying dis- crimination in relation to the freedom to provide services. Government to attain its objective are lawful.

64. The preamble to the relevant Greek Law states that its object is to resolve the doubts which undermine the employment status of wage earners, but no further details are given. This reason does not justify interfer- ing with the freedom to provide services 66. Although no justification based on such which is guaranteed by the Treaty. grounds can be found for impeding the free- dom to provide services, I should still like to consider whether the Greek Government was entitled to take the measure in question in order to attain its objective. One criterion in this connection is whether the measure is suitable for attaining the objectives pursued. This does not seem to me to be the case for several reasons. Firstly, none of the parties contends that, in order to settle the collective 65. Finally, during the oral procedure the labour dispute, it is necessary to restrict Greek Government stated that it had work by tourist guides from other Member adopted the measure in question in order to States either on a freelance basis or for tour ensure the high quality of services to con- companies from other Member States in the sumers. However, it says that its primary aim sector of organized tours. N o t once has it was the proper functioning of the economy. been claimed that such an activity has any It may be that the poor functioning of the effect whatever on that dispute. For that rea- tourist industry adversely affects the quality son alone, a restriction on work by tourist of services provided by tourist guides, but on guides from other Member States either on a the other hand poor guide services have an freelance basis or for tour companies from adverse effect on the economy. Because of other Member States cannot be suitable for this interplay and of the absence of further attaining the objective pursued.

71. O n those grounds I conclude that Article 59 et seq. of the EC Treaty must be interpreted as precluding a provision such as Article 37. That provision is also unjustified 68. It follows automatically that Article 37 on grounds of public interest and is, more- likewise cannot constitute a measure which over, disproportionate.

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C — Conclusion

72. I therefore propose that the Court answer the question submitted by the national court for a preliminary ruling as follows:

Article 59 et seq. of the EC Treaty must be interpreted as precluding a provision such as Article 37 of Law N o 1545/1985 which, subject to fulfilment of the condi- tions set out therein, prescribes a mandatory legal form of employment relation- ship between the parties concerned. The abolition of the freedom to provide ser- vices resulting from that provision is not a permissible means for ensuring industrial peace in connection with the provision of tourist services, an area which is important for a country dependent on tourism.