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ing and consulting employees under the 1 000 employees within the Member terms, in the manner and with the effects States and at least 150 employees in laid down in this Directive. each of at least two Member States;

(b) "group of undertakings" means a con- trolling undertaking and its controlled undertakings; 4. Unless a wider scope is provided for in the agreements referred to in Article 6, the powers and competence of European Works Councils and the scope of infor- mation and consultation procedures estab- lished to achieve the purpose specified in paragraph 1 shall, in the case of a Com- (c) "Community-scale group of undertak- munity-scale undertaking, cover all the ings" means a group of undertakings establishments located within the Member with the following characteristics: States and, in the case of a Community- scale group of undertakings, all group undertakings located within the Member States.

— at least 1 000 employees within the Member States, ...'

3. Article 2(1) of the directive provides that: — at least two group undertakings in different Member States, and

...' In the absence of such a representative, the management of the establishment or group undertaking employing the greatest number of employees in any one Member State shall take on the responsibility referred to 4. Article 3(1) provides that: in paragraph 1.

'1. For the purposes of this Directive, 3. For the purposes of this Directive, the "controlling undertaking" means an under- representative or representatives or, in the taking which can exercise a dominant absence of any such representatives, the influence over another undertaking ("the management referred to in the second controlled undertaking") by virtue, for subparagraph of paragraph 2, shall be example, of ownership, financial partici- regarded as the central management.' pation or the rules which govern it.'

6. Article 5(1) of the directive provides 5. By virtue of Article 4 of the directive: that:

' 1 . The central management shall be 'In order to achieve the objective in responsible for creating theconditions and Article 1(1), the central management shall I-792

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initiate negotiations for the establishment 2. Member States shall ensure that the of a European Works Council or an information on the number of employees information and consultation procedure referred to in Article 2(1)(a) and (c) is made on its own initiative or at the written available by undertakings at the request of request of at least 100 employees or their the parties concerned by the application of representatives in at least two undertakings this Directive. or establishments in at least two different Member States.'

10. The Federal Republic of Germany transposed the directive in the Gesetz über Europäische Betriebsräte (Law on Euro- pean Works Councils) of 28 October 1996 (hereinafter the 'EBRG'). 3 2. A works council or a central works council may exercise the right granted in subparagraph 1 against the local manage- ment of the establishment or undertaking; the latter shall be required to obtain from the central management the information and documents necessary to provide the 11. Paragraph 1(3) of the EBRG defines the particulars requested.' 4 concept of 'central management' of the undertaking or group of undertakings, and Paragraph 2(2) makes provision for cases where that management is located in a non-Member State: in such cases, where there is neither a subordinate management nor a representative designated by the central management, the German legis- I I — Facts and proceedings in the national lation has recourse to a legal fiction, court regulating the matter in accordance with the second subparagraph of Article 4(2) and with Article 4(3). 13. The action pending in the Bundes- arbeitsgericht is between the German com- pany Kühne & Nagel AG & Co. KG (hereinafter 'Kühne & Nagel' or the 'Ger- man company') and the Gesamtbetriebsrat 12. Paragraph 5 of the EBRG provides (central works council) of that company. that:

14. The order for reference states that Kühne & Nagel forms part of a Commu- '1. The central management must give to nity-scale group of undertakings the central the employees' representatives, upon management of which is situated in Swit- request, information on the average zerland. No European Works Council has numbers of employees and the distribution been established in this group or any

procedure for the purpose of informing and pany does not dispute the obligation to consulting employees within the meaning send the particulars specified in Paragraph of Article 1(2), and attempts by the 5( 1 ) of the EBRG but claims that it is not in employees to establish a special negotiating a position to comply, since the central body within the meaning of Article 5 of the management of the group is not subject to directive have never been successful. Community law and refuses to give it these particulars. The requests made to the other group companies have also remained unanswered and Kühne & Nagel itself has no information on the matter. It is there- fore not possible to respond to the Gesamtbetriebsrat's claim, which con- sequently must be rejected. In any case, 15. The order for reference also shows that apart from that, the German company there is no subordinate management of the considers that there is no legal basis for Kühne & Nagel group in any Member the request for information on the State, and that the central management has employee representation bodies set up in never designated any local representative the other Member States. under the first subparagraph of Article 4(2) of the directive. Since the German company is the group undertaking with the greatest number of employees in the Member States, it therefore — under Paragraph 2(2) of the EBRG (second subparagraph of Article 4(2), and Article 4(3), of the directive) — takes on the responsibility of the central management. On that basis, the Gesamtbetriebsrat therefore requested Kühne Sc Nagel to send it the particulars specified in Paragraph 5(1) of the EBRG, and also the names and addresses of the employee representation bodies set up in 17. The court making the reference holds the group undertakings situated in the that the claim by the Gesamtbetriebsrat to other Member States. receive the information referred to in Para- graph 5(1) of the EBRG is sound but it perceives the situation of the German company to be unbalanced: it is required to send that information but it does not have appropriate means of obtaining it from the group undertakings established in the other Member States. If the objection 16. Receiving a refusal from Kühne & by Kühne & Nagel is to be rejected, it must Nagel, the Gesamtbetriebsrat applied to in fact have those means. The Bundes- the competent German court for satisfac- arbeitsgericht states that the solution can- tion of its claim. The first- and second- not be sought in the German legislation, instance courts found against Kühne & which has no effect in respect of undertak- Nagel, which therefore appealed to the ings situated outside Germany; but it does Bundesarbeitsgericht. The German com- accept that, on the basis of the second

'(1) Is it a requirement of Directive I I I— Procedure before the Court of Jus- 94/45/EC on the establishment of a tice European Works Council or a pro- cedure in Community-scale undertak- ings and Community-scale groups of undertakings for the purposes of 20. In the written procedure, observations informing and consulting employees, were submitted to the Court by the in particular Articles 4 and 11 thereof, Gesamtbetriebsrat, Kühne & Nagel, the that undertakings which belong to a Federal Republic of Germany, the Kingdom I-796

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of Sweden and the Commission of the legislation implementing the directive. Fur- European Communities. The German and thermore, according to Kühne & Nagel, in Swedish Governments and the Commission order to secure the practical effect of the subsequently responded to the written directive, there is no need to risk the questions put to them by the Court. The independence of the individual undertak- Gesamtbetriebsrat, Kühne & Nagel and the ings in the group, for it is sufficient to Commission also took part in the hearing accord the workers' representatives a right on 15 January 2002. to information in respect of each of those undertakings. The question ought therefore to be answered in the negative.

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(2) Assessment takings of the group. The court making the reference therefore asks whether, in order to overcome that obstacle, it is possible to assume that the German company has a corresponding right to information in respect of the group undertakings situated in the Member States, on the basis of 26. In the present proceedings, the Court Articles 4 and 11 of the directive. has to rule for a second time on the right of workers to obtain information for the purpose of establishing a European Works Council under Directive 94/45. This occurred for the first time in the Bofrosr* case, 5which sought to establish whether workers may rely on Article 11(2) of the 28. In answering this question, it must be directive to obtain information from an noted first of all that, as is shown by undertaking belonging to a group when the Article 1, the purpose of this directive is to group central management has not yet been improve the transnational information and identified. This time, however, the question consultation of the employees of undertak- referred to the Court relates to a case where ings and groups of undertakings operating the group central management is known in two or more Member States, making but is outside the territory of the Member provision for the establishment, within States and the obligations imposed upon it those undertakings and groups where it is for the purposes of the second subpara- requested, of a European Works Council or graph of Article 4(2), and of Article 4(3), of of other procedures equally suited to the directive are taken on by a 'construc- achieve that purpose. That, as Article 1 of tive' central management. The national the directive also states, covers the entire court is seeking to find out whether and Community-scale undertaking or, in a how, in this case also, the directive guar- group of undertakings, all the undertakings antees effective exercise of the workers' which are part of the group and are right to information in respect of the situated in the Member States and so central management. concerned in implementation of the direc- tive. 6

role of the central management of the logistical conditions and means for negoti- Community-scale undertaking or group of ations with the workers' representatives to undertakings, upon which Article 4(1) of be able to proceed duly 8and, prior to that, the directive places primary responsibility to make it possible to set up a special for achieving the purpose laid down in the negotiating body within the meaning of directive, since it is the effective decision- Article 5(2) of the directive. But primarily it making centre of the undertaking or the follows that there is an obligation imposed group [Article 2(1)(e) and Article 3(1)]. The on the central management to afford the 'principle that the central management is workers all information necessary for the responsible' must in fact, according to a initiation and the successful outcome of the number of commentators, be regarded as negotiations and, if appropriate, for the one of the guiding principles of the direc- European Works Council to be established tive. 7In any event, as Article 4(1) makes by force of law under Article 7 of the clear the responsibility of the central man- directive, where the conditions for that agement is very wide and covers all the obtain. 9 conditions and means necessary for setting up the mechanisms for informing and consulting employees specified in the direc- tive. That responsibility includes the obli- gation, using all available resources, to meet any need that may arise in the setting up of a European Works Council or a 31. That having been said, I must point out procedure for the purpose of informing and here that, as we see from the 14th recital in consulting employees under the directive, the preamble 10and from Article 11(1) of limited only in that the activity requested of the directive, the mechanisms for informing the central management should be truly and consulting employees must be correctly necessary for the purpose. established in the Community-scale under- taking or group of undertakings whether or not the central management is situated inside the territory of the Member States. In fact, to prevent the establishment of the central management in a non-Member

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State from hindering achievement of the the Community directive on collective purposes of the directive, Article 4 lays redundancies 12 and also to that on safe- down a system whereby such a situation guarding employees' rights in the event of may be dealt with. As we have seen, transfers of undertakings — this latter also subparagraph 2 proposes that a represen- referred to by the Swedish Government in tative agent of the central management in a its observations to the Court. 13 These Member State should be designated and, in directives expressly provide that the obli- the absence of such representative, provides gations which they impose upon employers, that '... the management of the... group of advance information to and consultation undertaking employing the greatest number of workers in a collective redundancy or of employees in any one Member State transfer of an undertaking, must be met shall take on the responsibility referred to whether the decisions concerned are taken in paragraph 1'. In any event, subpara- by the employer or by another undertaking graph 3 lays down that the designated controlling the employer. In order to ensure representative or, if none, the 'constructive' that those obligations are met, these direc- management '[f]or the purposes of this tives provide that the employer is not Directive... shall be regarded as the central relieved of responsibility on account of management'. 1 1In both cases, the result is the fact that the controlling undertaking that the responsibility which the directive has not supplied the information needed. 14 places on the central management is entirely transferred to the 'constructive' management, which will therefore be sub- ject to the same obligations as the former and, like it, will be responsible for fulfilling them.

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actual central management — it does not Commission also has pointed out, in hold the powers to direct and coordinate accordance with Article 11(1) and the group which are necessary for that Article 14 of the directive the competent purpose. This is, very clearly, also the authorities of the Member States must concern of the national court, which asks penalise any failure on the part of the whether, in order to enable the 'construc- 'constructive' central management to meet tive' central management to meet the obligations stemming from Article 4(1) obligation to provide information which is exactly as they would failure on the part incumbent upon it by virtue of Article 4(1), of the actual central management of the it may be inferred from the directive that group, in particular by means of the that management has the right to obtain 'administrative or judicial procedures... to the information needed for the purpose enable the obligations deriving from this from the other undertakings in the group, Directive to be enforced' provided for in in particular relying upon the provisions of Article 11(3). Article 11(2) of the directive which, as we have seen, imposes upon those undertak- ings an obligation to provide information.

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38. However, once it has been established and effective application. that the undertaking or the group falls within the field of application of the directive then, by virtue of the general responsibility arising under Article 4(1), it is the central management which is subject to the obligation to send the workers all the information needed to set up the European Works Council, including of course the 37. Next, more specifically, I must note information which each of the undertak- that, because of its particular and limited ings in the group must supply, on the function, I do not feel that the obligation to specific aspects which relate to it, for the provide information which Article 11(2) of purposes of Article 11(2).

if they are to be able to determine whether or not they are entitled the central management of the group. to request the opening of negotiations [to set up a European Works Council or a procedure tor the trans- Firstly, that provision is addressed to the national information and consultation of the workers] and, undertakings without distinction and on an where relevant, to make that request in due form' (paragraph 38). I would note that this judgment was given individual basis, not mentioning the con- in respect of a group of undertakings where it had not yet been established that there was a controlling undertaking cepts either of a central management or of and, hence, a central management, within the meaning of the Community-scale undertaking or group the directive.

40. In conclusion, I consider that the answer to the first question must be that, in groups of undertakings where the central management is situated outside the terri- tory of the Member States, it is the management taking the place of the central management for the purposes of the second subparagraph of Article 4(2) and of Article 4(3) of the directive which must make available to the internal bodies 39. Apart from that, I must note that the representing the workers so requesting all solution whereby the 'constructive' central the information necessary for the purpose management is granted a right to infor- of setting up a European Works Council or mation in respect of the other companies in a procedure for the purpose of trans- the group, although creating many dif- national information and consultation of ficulties of implementation in practice — employees. It is for the Member States to as has been amply shown during the guarantee compliance with this obligation procedure before the Court, can indeed in accordance with Article 11(1) and (3) serve to guarantee the workers access to the and Article 14 of the directive. information needed for setting up the European Works Council. However, on a more general level, it gives no guarantee of effective implementation of the infor- mation and consultation mechanisms pro- vided in the directive. We need only remember that, unless it is desired to intervene in the arrangement of the legal and organisational links among the com- B — The second question referred panies in the group, even if the European Works Council were set up, the cooper- ation of the actual central management of the group would still be essential to ensure that it operated properly. Clearly, in fact, 41. In this question, the national court asks only the actual central management can whether the obligation to provide infor- effectively inform and consult the council regarding the general position and the prospects of the group, or on the strategic 16 — In particular, see points 2 and 3 of the Supplementary decisions likely to have a significant effect Requirements annexed to the directive (and see also note 9).

mation which is laid down in the directive information requested is necessary for the also encompasses the names and addresses purpose of setting up a European Works of the employee representations participat- Council. 17 But I believe that it is not for the ing in the setting up of a special negotiating Court of Justice but for the court making body in accordance with Article 5 of the the reference, using all the evidence avail- directive or in the establishment of a able to it, to find whether in this instance European Works Council. In the light of the information referred to in the question the answer which I have proposed should is necessary in this way. I would only add be given to the first question, I consider that, because this obligation to provide that the second question also must be information is incumbent upon the central examined. management because of the general respon- sibility placed upon it by Article 4(1) of the directive then, for the reasons described above, that same obligation is incumbent also upon the management taking the place of the central management under the sec- ond subparagraph of Article 4(2), and Article 4(3). 42. I would note first of all that, according to Kühne & Nagel, information relating to the names and addresses of the worker representations do not come within the scope of the directive, because that would go beyond what is necessary for the pur- poses of setting up a European Works Council. The Commission thinks similarly, adding that — precisely for that reason — it is not possible to infer an obligation to 44. I therefore believe that the second provide that information from the duty of question referred is to be answered to the cooperation required by the directive as effect that the central management of the between undertakings and workers or their group or, as appropriate, the management representatives. However, the Gesamtbe- taking on responsibility under the second triebsrat and the German Government subparagraph of Article 4(2), and believe that this information is part of the Article 4(3), of Directive 94/45 is required information necessary for setting up a to provide the workers' representatives at European Works Council and therefore their request with the information relating falls within the scope of the directive. to the names and addresses of the repre- sentations of the employees of undertakings which are part of a group of undertakings if such information is necessary to the setting up, within that group, of a European Works Council.

(1) Articles 4 and 11 of Council Directive 94/45/EC of 22 September 1994 on the establishment of a European Works Council or a procedure in Community- scale undertakings and Community-scale groups of undertakings for the purposes of informing and consulting employees are to be interpreted to mean that, in the case of a group of undertakings the central management of which is situated outside the territory of the Member States, it is the management taking the place of the central management for the purposes of the second subparagraph of Article 4(2) and of Article 4(3) of the directive which must make available to the internal bodies representing the workers so requesting all the information necessary for the purpose of setting up a European Works Council or a procedure for the purpose of transnational information and consultation of employees. It is for the Member States to guarantee compliance with this obligation in accordance with Article 11(1) and (3) and Article 14 of the directive.

(2) The central management of the group or, as appropriate, the management taking on responsibility under the second subparagraph of Article 4(2) and Article 4(3) of Directive 94/45 is required to provide the workers' represen- tatives at their request with the information relating to the names and addresses of the representations of the employees of undertakings which are part of a group of undertakings if such information is necessary to the setting up, within that group, of a European Works Council. I-806