C-317/01

ABATAY AND OTHERS

OPINION OF ADVOCATE GENERAL MISCHO delivered on 13 May 2003 1

Table of contents

I — Legal background I -12306

A — The EEC-Turkey Association I -12306

B — National legislation I -12309

2. Assessment I - 12316

B — The second question referred for a preliminary ruling in Case C-317/01 and

the third question referred for a preliminary ruling in Case C-369/01 I-12318

1. Opinion of the national court and arguments raised before the Court . . . I-12319

2. Assessment I -12321

C — Part (b) of the third question referred for a preliminary ruling in Case

(b) Concerning the existence of a new restriction on the freedom to provide services 1-12333 (i) Carriage is provided in the name and under the responsibility of a Turkish undertaking 1-12333 — The Turkish undertaking provides carriage using its own lorries and its own drivers I -12333 — The Turkish undertaking provides carriage using its own drivers but with lorries which belong to a German undertaking and which are registered in Germany I -12334 (ii) Carriage is provided in the name and under the responsibility of a German undertaking 1-12336 — The Turkish drivers are taken on by the German undertaking direc riy 1-12336 — The Turkish drivers are taken on and paid by a Turkish undertaking j _ 12339 D — Part (a) of the third question referred for a preliminary ruling in Case C-317/01 and part (a) of the first question referred for a preliminary ruling in Case C-369/01 .. 1-12343 E — The second question referred for a preliminary ruling in Case C-369/01 1-12345 IV· Conclusion j . 12346

1. The Seventh and Eleventh Chambers of Legal background the Bundessozialgericht (Federal Social Court, Germany) have referred questions to the Court for a preliminary ruling on the interpretation of Article 41(1) of the Addi- tional Protocol of 23 November 1970 to the Agreement establishing an Association between the European Economic Commu- nity and Turkey of 1 9 6 3 , 2 and of Article 13 A — The EEC-Turkey Association of Decision N o 1/80 of 19 September 1980 on the development of the Association, adopted by the Association Council estab- lished by the abovementioned Agreement. 3

nity, of the other part, and concluded, 6. Article 14 of the Agreement provides: approved and confirmed on behalf of the C o m m u n i t y by Council Decision 64/732/EEC of 23 December 1963 on the conclusion of the Agreement establishing an Association between the European Economic Community and Turkey. 4 'The Contracting Parties agree to be guided by Articles 55, 56 and 58 to 65 of the Treaty establishing the Community for the purpose of abolishing restrictions on the freedom to provide services between them.' 3. Article 2(1) of the Agreement provides that its aim is to promote the continuous and balanced strengthening of trade and economic relations between the contracting parties, including relations in the employ- 7. In terms of Article 22(1) of the Agree- ment sector, by progressively securing free- ment: dom of movement for workers (Article 12), as well as by the abolition of restrictions on the freedom of establishment (Article 13) and the freedom to provide services (Article 14). '1. In order to attain the objectives of this Agreement the Council of Association shall have the power to take decisions in the cases provided for therein. Each of the 4. Article 6 of the Agreement provides for Parties shall take the measures necessary to the creation of an Association Council implement the decisions taken....' which is to act within the powers conferred upon it by the Agreement.

8. The Additional Protocol includes a Title II, headed 'Movement of persons and 5. Article 12 of the Agreement states: services', Chapter I of which relates to '[w]orkers' and Chapter II of which to '[r]ight of establishment, services and trans- port'. Article 36, which forms part of Chapter I, lays clown timescales for secur- 'The Contracting Parties agree to be guided ing freedom of movement for workers by Articles 48, 49 and 50 of the Treaty between the Member States of the Com- establishing the Community for the pur- munity and the Republic of Turkey by pose of progressively securing freedom of progressive stages in accordance with the movement for workers between them.' principles laid down by Article 12 of the Agreement, and states in its second para- graph that the Association Council is to 4 —OJ 1973 C 113, p. 1. decide on the rules necessary to that end.

2. The Council of Association shall, in accordance with the principles set out in Articles 13 and 14 of the Agreement of Association, determine the timetable and rules for the progressive abolition by the Contracting Parties, between themselves, of 12. Article 8(1) provides that, 'should it not restrictions on freedom of establishment be possible in the Community to meet an and on freedom to provide services. offer of employment by calling on the labour available on the employment market of the Member States and should the Member States, within the framework of their provisions laid down by law, regu- lation or administrative action, decide to The Council of Association shall, when authorise a call on workers who are not determining such timetable and rules for nationals of a Member State of the Com- the various classes of activity, take into munity in order to meet the offer of account corresponding measures already employment, they shall endeavour in so adopted by the Community in these fields doing to accord priority to Turkish and also the special economic and social nationals'. circumstances of Turkey. Priority shall be given to activities making a particular contribution to the development of produc- tion and trade.'

13. Article 13 of Decision No 1/80, which 10. On 19 September 1980, the Associ- forms part of Chapter II, headed 'Social ation Council adopted Decision No 1/80. provisions', Section 1, headed 'Questions I - 12308

ABATAY AND OTHERS

relating to employment and the free move- 15. The 10th regulation amending the ment of workers', states that: AEVO, which was adopted and came into force on 1 September 1993 (BGBl. I, p. 1527), amended Paragraph 9(2) by restricting the right to a dispensation from work permits to travelling personnel work- ing in the international carriage of passen- 'The Member States of the Community and gers and goods 'for employers with regis- Turkey may not introduce new restrictions tered offices abroad'. on the conditions of access to employment applicable to workers and members of their families legally resident and employed in their respective territories.' 16. On 30 September 1996 (BGBl. 1, p. 1491), a further amendment was made to Paragraph 9(2) of the AEVO. The version in force from 10 October 1996 reads as follows:

which replaced the AEVO, adopted the text 30 September 1996. However, after that of Paragraph 9(2) of the AEVO without date, it refused to issue further permits. amendment.

20. In proceedings brought by Mr Abatay and Others, the Sozialgericht, Nürnberg I I — Facts and main proceedings (Social Court, Nuremberg, Germany), found that the claimants did not require work permits. This judgment was con- firmed on appeal by the Bayerisches Land- essozialgericht (Higher Social Court, Bav- aria, Germany). Those courts held, in A — Case C-317/01 essence, that the restriction imposed by the new German provisions, requiring Mr Abatay and Others to be the holders of such permits, amounted to a restriction contrary to the 'standstill' clause of 18. Messrs Eran Abatay, Abdulgam Article 13 of Decision No 1/80. Balikci, Ismail Birer and Refik Günes (here- inafter 'Mr Abatay and Others') are Tur- kish nationals residing in Turkey and work mainly as drivers engaged in international haulage of goods. They are employed and paid by Baqir Dis Tic. Ve Paz. Ltd, which has its registered office in Mersin, Turkey 21. The Bundesanstalt für Arbeit brought (hereinafter 'Baqir Ltd'), which is a sub- an appeal on a point of law, challenging the sidiary of Baqir GmbH, which has its interpretation given by the appeal court of registered office in Stuttgart, Germany. Article 13 of Decision No 1/80. Baqir Ltd and Baqir GmbH import fruit and vegetables, mostly self-grown, into Germany. The goods are transported from Turkey to Germany by means of lorries registered in Germany in the name of Baqir GmbH and driven by (among others) Mr Abatay and Others. 22. Proceedings having been raised before it, the Eleventh Chamber of the Bundesso- zialgericht asks in its order for reference whether the claimants have a valid claim to be exempt from the requirement to obtain a work permit, based on Article 13 of 19. After the coming into force of the new Decision No 1/80 or Article 41(1) of the regulation, the Bundesanstalt für Arbeit Additional Protocol. The amendments to (Federal Labour Office, Germany) con- the AEVO brought into force on tinued to issue, on a temporary basis, a 1 September 1993 and 10 October 1996 work permit to the drivers valid until could be construed as amounting to new

23. There is no doubt in this regard that these provisions are directly applicable in 26. However, the document called 'Agency Member States, but their scope raises a Agreement' ('Agenturvertrag') which is to number of problems. be found in the file transmitted by the national court merely provides that the Turkish subsidiary is authorised 'to load and unload our vehicles as well as those of transport undertakings used by us, and to carry out the customs formalities and other 24. I shall set out below the questions administrative formalities associated with referred for a preliminary ruling put by that' ('ist berechtigt, unsere Fahrzeuge the Eleventh Chamber in this regard, as sowie die Fahrzeuge der von uns einge- well as the substance of the commentary setzten Transportunternehmer zu ent- und which accompanies them. beladen, die damit im Zusammenhang stehenden zollamtlichen und behördlichen Tätigkeiten vorzunehmen').

B — Case C-369/01

28. By application of 29 May 1996, Mr restrictions relating to work permits for Sahin sought a declaration that the workers Turkish workers. in question did not require work permits for their activities. He obtained an interim order from the Sozialgericht Ulm (Ger- many), on 9 December 1996, that required the Bundesanstalt für Arbeit to issue work 33. The Seventh Chamber of the Bundes- permits to the drivers pending a final sozialgericht has raised questions on the decision on the substance of the case. scope of Article 41 of the Additional Protocol, on the relationship between this article and Article 13 of Decision No 1/80 and on the scope of the latter provision. That court has referred several questions 29. However, in a final judgment delivered for a preliminary ruling to the Court in on 10 February 1998, the Sozialgericht Ulm order to resolve these issues. held that the 17 drivers in question did not need to obtain a work permit.

I I I— Consideration of the questions 30. The appeal raised by the Bundesanstalt referred for a preliminary ruling für Arbeit was dismissed by decision of 27 July 2000 of the Landessozialgericht, Baden-Württemberg (Germany), which based its reasoning in essence on Article 41(1) of the Additional Protocol, 34. While recognising that the way in holding that the legal rules in force on which the Commission has regrouped and 1 January 1973 remained relevant. reformulated the different questions is useful, my preference is to retain their original wording.

31. The Bundesanstalt für Arbeit brought an appeal on a point of law against that judgment, claiming in particular that there had been a breach of Paragraph 9(2) of the A — The first question referred for a AEVO. preliminary ruling in Case C-317/01

36. The national court observes that the wording of Article 13 suggests that the prohibition on the introduction of new restrictions under Article 13 should be interpreted as meaning that it applies only to the time from which the worker's 39. Mr Abatay and Others also challenge residence and employment in the territory the relevance of this question to the result of the State concerned first became lawful, of the case where the claimants in the main and not the time from which the provision proceedings were already legally resident in first became applicable. However, that the Member State in question or were interpretation of Article 13 is not manda- legally employed there at the date on which tory. the new national legislation came into force. Employment and residence in the Member State are lawful as soon as they comply with the legal and regulatory requirements in force in that State. 5 The employment of the claimants in the main 37. Mr Abatay and Others construe the proceedings was accordingly lawful before first question in Case C-317/01 as meaning the amendment of the AEVO which came that the national court asks whether into force on 10 October 1996 and came Article 13 of Decision No 1/80 prohibits, within the scope of protection of Article 13. in the abstract, the adoption of any provi- The first question does not therefore sion by which access to employment is require to be answered. made subject to a new restriction or whether the intention of the provision is to set the point of departure by reference in 5 — Case C-1/97 Birden [1998] ECR I-7747.

40. Mr Abatay and Others rely in the yet been taken on. A person who is work- alternative on Article 6 of Decision ing has no need for access to the labour No 1/80, which gives a Turkish worker force, because he is already part of it. The duly registered as belonging to the labour provision in question is intended to assist force of a Member State the right of free access to the market, and it follows that, as access in that Member State to any paid far as the application of the clause is employment of his choice after four years concerned, the time when legal employ- of legal employment. ment is first taken up is of no relevance. Nor is the critical factor the date of first legal residence, as there is one point behind the provision in question, namely that illegal residence can never form a basis for access to employment rights. 6 41. According to Mr Sahin, the proprietor of an international haulage business and claimant in the main proceedings in Case C-369/01, the 'standstill' applied from the date of the coming into force, on 20 December 1976, of Decision No 2/76, which preceded Decision No 1/80. Article 7 43. The German Government considers of the earlier decision contained a provision that the prohibition on introducing new relating to workers that was similar to restrictions contained in Article 13 of Article 13 of the later decision. To interpret Decision No 1/80 only applies from the these articles as meaning that the prohib- date of first legal residence and first legal ition on introducing new restrictions on employment of the workers concerned in access to employment refers to the date of the host Member State. It takes the view first legal residence and employment of the that this analysis is supported by a workers concerned (as the Bundesanstalt comparison with Article 41(1) of the Addi- für Arbeit and the Member States do) tional Protocol. While that provision is of would be illogical, in that a person who general application, the terms of Article 13 already formed part of the labour market of of Decision No 1/80 are more limited in a Member State would no longer have any scope, and relate only to workers and need to benefit from a rule prohibiting members of their families who are legally further restrictions on access to employ- resident. ment.

to ensure the progressive consolidation of Decision No 1/80 shows that the prohib- the position of Turkish workers who have ition which it contains relates solely to regularly formed part of the labour force in 'legal' workers who arc already in employ- a Member State. Every worker is entitled to ment. The 'standstill' obligation applies be certain that his rights existing at the time only to workers who already form part of of his entry to the territory could not be the labour force. The provision does not adversely affected. T h a t consolidating however regulate the conditions applying objective of Decision N o 1/80 does not to entry of these workers to the labour however affect the power of national auth- force. The Member States have therefore orities to control the entry of Turkish retained the power to adopt new restric- nationals into the territory of the Member tions as regards entry to the labour force, State concerned and their first employment but they cannot introduce restrictions in that State. The same logic underlies which would affect workers who already Article 6 of Decision N o 1/80. form part of it.

which Member States retain the compet- Member States to regulate both the ence to regulate entry to the labourforce. entry into their territories of Turkish nationals and the conditions under which they may take up their first employment, but merely regulate the situation of Turkish workers already lawfully integrated9 into the labour 49. The Commission notes that 'Decision force of Member States (see, in par- No 1/80 confers... no right of freedom of ticular, Case C-171/95 Tetik v Land movement to Turkish workers. In the Berlin [1997] ECR I-329, paragraph current state of the law governing the 21). EEC-Turkey Association, the establishment of conditions governing entry to the terri- tory of a member of the European Union remains within the exclusive competence of that State. Workers enjoy no rights under Decision No 1/80 until they have entered the labour market in a Member State'. 59 Next, the Court has repeatedly held that, unlike nationals of Member States, Turkish workers are not entitled to move freely within the Community but benefit only from certain rights in the host Member State whose territory they have lawfully entered and where they have been in legal employment for 2. Assessment a specific period (see, in particular, Tetik, paragraph 29).'

50. The Commission's observations are plainly correct, as are the corresponding views of the Governments of the Member States. 52. The Savas judgment refers generally 'to the provisions of the EEC-Turkey Associ- ation Agreement'.

51. In its judgment in the Savas case, cited above, the Court moreover held that: 53. It would thus be incorrect to interpret Article 13 of Decision No 1/80 in a different sense, for example by retaining only the first part ('The Member States of the Community and Turkey may not intro- '58 ... the provisions concerning the EEC- Turkey Association do not encroach upon the competence retained by the 9 — Author's emphasis.

10 — Subject always to the safeguards laid down by Article 12 of Decision N o 1/80, which reads as follows: 56. However, by reason of Article 13, such 'Where a Member State of the Community or Turkey experiences or is threatened with disturbances on its restrictions cannot affect workers who have employment market which might seriously jeopardise the already obtained legal employment and a standard of living or level of employment in a particular region, branch of activity or occupation, the State con- right of residency in the Member State in cerned may refrain from automatically applying Articles 6 question at a time which preceded the and 7. The State concerned shall inform the Association Council of any such temporary restriction.' introduction of these new restrictions. 11 — Case C-188/00 [2002] ECR I-10691 paragraph 68.

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OPINION OF MR MISCHO — JOINED CASES C-317/01 AND C-369/01

61. As the German, French and Nether- 65. I therefore suggest that the first ques- lands Governments have pointed out, the tion raised in Case C-317/01 be answered sole purpose of Article 13 is therefore to as follows: strengthen the position of Turkish workers (under Articles 6 and 7) who have already taken up legal employment.

'Article 13 of Decision No 1/80... must be interpreted as meaning that where, at any time after 1 December 1980, a Member State of the Community introduces new restrictions on access to the employment market for Turkish workers, those restric- 62. The objection might be raised that in tions will not apply to Turkish workers those conditions Article 13 is superfluous, who, at the time when the restrictions come because under the principle pacta sunt into force, are already on the territory of servanda, the Member States are already and legally resident and employed in that prohibited from interfering with rights Member State.' acquired by the workers under Articles 6 and 7. 12

'... it is doubtful whether Article 13 of Case C-369/01: Decision No 1/80 must also be applied to workers such as the claimants, who are employed in Turkey and who all, as travel- ling personnel, merely pass through a Member State such as Germany in the course of international haulage operations without belonging to the legitimate labour 'Is Article 13 of Decision No 1/80... also to force in Germany (Question 2). be applied to Turkish employees of an employer with its seat in Turkey who, as long-distance lorry drivers engaged in inter- national haulage, regularly pass through a Member State of the Community without belonging to the (legitimate) labour force of that Member State?'

The position of Article 13 within Section 1 of Chapter II of Decision No 1/80 ("Ques- tions relating to employment and the free movement of workers") and of other provisions of that section (in particular Articles 6, 7, 10 and 11) supports the view that Article 13 of Decision No 1/80 applies only to workers who belong to the legit- The limitation of the scope of Article 13 of imate labour force of a Member State... . Decision No 1/80 to workers belonging to The fact that the activity engaged in by the legitimate labour force is nevertheless foreign long-distance lorry drivers, which not the only possibility, as the view taken affects German territory to only a limited by the Landessozialgericht shows. How- extent, is not covered by the provisions of ever, the Chamber does not share the Section 1 of Chapter II of Decision No 1/80, Landessozialgericht's reasoning that the and thus not by Article 13, could stem, protection contemplated by Article 13 of inter alia, from the fact that the provisions Decision No 1/80 must also extend to of that section are aimed at the progressive Turkish workers employed in international integration of Turkish workers and transport on the ground that in circum- members of their families into the labour stances such as those of the present case the force. The right to take up further employ- domestic employment market is only mar- ment and, therefore, the right of residence ginally affected and therefore a restrictive in the territory of the State concerned (see interpretation of the standstill clause is not Sevince, cited above, and Case C-237/91 appropriate. That line of reasoning would Kus [1992] ECR I-6781) are greater the needlessly restrict the Member States and longer and more continuously legal Turkey in their scope for taking effective employment has been engaged in before- action against abuses in their employment hand. It is questionable whether such rights and economic markets. Moreover, it is can properly be conferred on long-distance doubtful whether, in circumstances of the lorry drivers who regularly enter the terri- present kind, the German employment tory of a State only for a limited time and market is only marginally affected if, as then always leave it again. Thus, for submitted by the defendant before the example, the fact of their continuing courts deciding on the facts in the present employment by a foreign employer — a case, the employment of drivers from low- necessary condition for work permit wage countries using vehicles registered in Germany has the effect that unemployed drivers resident in Germany are not 13 — Author's emphasis. recruited.'

72. The German Government for its part considers that Article 13 of Decision No 1/80 does not apply to lorry drivers who are employed in Turkey and who are engaged, from that country, in inter- national haulage operations, because they do not form part of the 'legitimate employ- 2. Assessment ment market' of the Member State in question.

76. It follows from the wording of both of 14 — See the judgment in the Birden case, cited above. these questions as well as from the obser-

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vations made by the national courts that 80. It should also be emphasised that in the the latter have already formed the view that Bozkurt judgment the Court used the the Turkish workers in question did not expressions 'existence of legal employment' belong to the legitimate labour force in (paragraph 25), 'legality of employment' Germany, as they did not meet the require- (paragraphs 26, 27 and 29), 'Turkish ment of a sufficiently close connection set nationals who are already duly integrated out in the Bozkurt judgment. 15 into the labour force' (paragraph 30) and 'existence of legal employment' (paragraph 31) interchangeably.

77. The two questions under consideration thus ask in effect whether persons whose working relationships do not involve a close connection with the territory of a 81. It plainly considered, therefore, that the Member State may, none the less, rely on expressions used in Article 6 and Article 13 Article 13. were synonymous.

ABATAY AND OTHERS

84. The national courts clearly state that — they were, for a time, issued with work 'according to those criteria, workers such permits and the Member State thus as the claimants, who are employed as recognised them as forming part of its long-distance lorry drivers in Turkey, do labour force; not in any event belong to the legitimate labour force in Germany if, as must be assumed in the present case, they are paid in Turkey and are subject to Turkish employment and social legislation'. — the lorries they drive are registered in Germany;

85. It therefore follows from paragraph 31 of the Bozkurt judgment that the fact that — they are in any event in an unusual legislation in force in a Member State does position, as their activities 'affect Ger- not require the possession of a work permit many to only a limited extent' and they does not mean that workers are automati- 'do not aspire in any way to a progress- cally to be treated as legally employed ively strengthened integration into the within the meaning of Article 13, as the German labour force' (according to the claimants in the main proceedings suggest. expressions used by the national courts).

87. I am of the view, however, that such an 86. It might however be tempting to dis- approach is incorrect. regard entirely the textual arguments set out above, as well as the Court's case-law requiring that sufficiently close connections be in place, in order to find an ad hoc solution to the problem of the Turkish drivers in question, based on the following considerations: 88. The fact that the drivers in question drive lorries registered in Germany should immediately be disregarded.

C — Part (b) of the third question referred for a preliminary ruling in Case C-317/01 and of the first question referred in Case 91. They benefited from the special regime C-369/01 granted by the Federal Republic of Ger- many to all drivers in international haulage and not just to drivers of Turkish national- ity.

94. The wording of these questions is 16 — Paragraph 3 of the judgment mentions that in the intervals almost identical. They fall to be analysed between his journeys and during his periods of leave, that driver lived in the Netherlands. and answered in the same way. They are 17 — Case 9/88 [1989] ECR 2989, paragraph 17. respectively worded as follows:

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Case C-317/01: (b) that there is also a restriction on the freedom to provide services where a Member State of the Community abolishes an existing work permit exemption for Turkish drivers engaged in international haulage who are employed by a (Turkish) 'Is Article 41(1) of the Additional Proto- employer with its seat in Turkey?' col... to be interpreted as meaning that:

1. Opinion of the national courts and arguments raised before the Court

restriction if it affects, as a businessman, international haulage of goods sector, in only a German national who is resident in particular to the Middle East. He maintains Germany. The question in the case is that long-distance international goods whether Mr Sahin, who has been a German haulage inevitably involves the carrying-out citizen since 1991, has the right to take on of activities in a market that is split Turkish drivers who no longer have work between undertakings subject to different permits. legal regimes and which, accordingly, pro- vide their employees with different income and social benefits depending on the legal rules and factual conditions applying in the State they come under. Undertakings in third countries may rely on having lower 97. The Turkish long-distance lorry salary overheads, but can more easily find a drivers, who are the claimants in Case workforce in the labour markets to which C-317/01, take the view that the imposition they have access which, in light of national of a requirement for a work permit for an economic difficulties, is ready to accept activity that had previously been exempted being separated from family members dur- restricts the freedom of Turkish haulage ing lengthy periods and which has the undertakings to provide services in the knowledge of languages necessary for jour- territory of a Member State. neys going as far as Turkey, or even to countries such as Iran, Jordan or Egypt.

age undertaking which is a subsidiary of a Treaty...', confirms that the general regime company registered in Germany uses relating to the provision of services docs vehicles registered in Germany in its par- not apply to transport. ent's name to provide haulage services between Turkey and Germany. As the Turkish undertaking used vehicles regis- tered in Germany, the authorities of that Member State were entitled to take the view that the international haulage in question had in reality been provided by the German parent company and that, as a result, the Turkish long-distance lorry 103. Even if Article 41 were to apply to the drivers were required to have a work present cases, the Netherlands Government permit in Germany. Article 41(1) of the takes the view that Article 41(1) must be Protocol does not apply to such a situation. interpreted so as not to render illusory the Moreover, any other interpretation would, powers of Member States in the field of the in the French Government's opinion, allow free movement of workers. Member States German haulage companies to avoid Ger- have reserved all powers to regulate the man employment law by allowing their access of Turkish nationals both to their Turkish subsidiaries to use the parent's territory and to their labour market, so as vehicles to provide haulage to Germany. to protect the stability of their labour markets. These powers would become illusory if measures that Member States can take in the context of the free move- ment of workers were to be prohibited in the context of the freedom to provide services.

106. I shall first consider the argument put forward by the Netherlands Government and shall then turn to the other arguments discussed during the proceedings before the Court. 109. As regards relations with the Turkish Republic, the relevant texts are Articles 14 and 15 of the Association Agreement and Article 42 of the Additional Protocol.

(a) Does Article 41(1) apply to transport services? Is this sector covered by these 110. In terms of Article 14, '[t]he Con- measures? tracting Parties agree to be guided by Articles 55, 56 and 58 to 65 of the Treaty establishing the Community for the pur- pose of abolishing restrictions on the free- dom to provide services between them'.

107. As mentioned above, the Netherlands Government considers that Article 41(1) of the Additional Protocol is not the right reference point for the present case, given that the legislation in question relates to the transport sector. In the EC Treaty, those 111. Article 61 of the Treaty thus appears activities are expressly excluded from the among the provisions by which the Con- freedom to provide services. Article 61(1) tracting Parties are to be guided. It follows of the EC Treaty (now, after amendment, that an analogy should not be drawn that Article 51(1) EC) states that: does not also take this article into account. I - 12328

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112. Article 15 of the Association Agree- 115. Faced with this situation, it would be ment states that: possible to object that, even if the abolition of restrictions on the freedom to provide services in the transport sector must be carried out by way of an extension of the common transport policy to Turkey, the 'standstill' clause nevertheless applies to this sector. 'The rules and conditions for extension to Turkey of the transport provisions con- tained in the Treaty establishing the Com- munity, and measures adopted in imple- mentation of those provisions shall be laid 116. However, that is not the case. This down with due regard to the geographical clearly follows from the judgment in the situation of Turkey.' Corsica Ferries France case, 19 to which the Netherlands Government has drawn atten- tion.

15 That conclusion is not weakened by the fact that those rules were reintroduced into the French code des ports mari- 122. In my opinion, however, there are times... after having been repealed in serious objections to this argument. 1969. In light of the existence of Article 61(1) of the Treaty, Article 62, which prohibits the Member States from introducing any new restrictions on the freedom to provide services which had in fact been attained at the date of entry into force of the Treaty, 123. It should be noted first of all that if, in does not apply.' 20 the Corsica Ferries France case, cited above, the Court was able to hold that a tax fell within the transport sector which was not levied on passengers disembarking in Corsica from continental France, while it was levied on all other disembarkations and embarkations, the same should a for- tiori apply to a rule concerning 'travelling personnel in the international carriage of 119. It can therefore likewise be concluded passengers and goods'. that the 'standstill' clause in Article 41(1) of the Additional Protocol has no appli- cation to the transport sector.

124. There is no doubt that the exemption from the requirement to obtain a work permit under the German regulation of 1971, by way of exception to the rules 120. It remains to be discussed whether the normally applying to nationals of third provision in dispute falls within that sector. countries, arose because of the particular features of international transport and in particular because non-German 'travelling 20 — Author's emphasis. personnel' only spend a limited time in

128. Council Regulation (EEC) No 881/92 of 26 March 1992 concerns access to the 131. Article 3(3) of Regulation No 881/92, inserted by Regulation No 484/2002, states that: 21 — In the Netherlands as well, international lorry drivers were not covered by the general policy on aliens. Sec the Bozkurt judgment, cited above, paragraphs 4 and 5. 22 — OJ 2002 L 76, p. 1. 23 — OJ 1992 L 95, p. 1.

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' 3 . A driver attestation shall be issued by a pulsory from 19 March 2003), but also lays Member State... to any haulier who: down the principle that drivers who are nationals of third countries put at the disposal of a haulier in a Member State must be used lawfully, that is to say by observing the conditions of employment laid down by the same Member State for — is the holder of a Community auth- drivers of its own nationality or residing in orisation, its territory. I shall return to this point below.

— in that Member State lawfully employs drivers w h o are nationals of non- member countries or lawfully uses drivers w h o are nationals of non- member countries put at his disposal 133. I should emphasise that this regu- in accordance with the conditions of l a t i o n was a d o p t e d on the basis of employment and of vocational training Article 71 EC. It follows that legislation laid d o w n in t h a t same M e m b e r such as that at issue in the present case also State: 24 comes within the transport sector.

— by laws, regulations or adminis- trative provisions, and, as appro- priate, 134. I therefore suggest that the Court m a k e s as its p r i m a r y f i n d i n g t h a t Article 41(1) of the Additional Protocol does not apply to national legislation covering the transport sector, of the kind — by c o l l e c t i v e a g r e e m e n t s , in in issue in the main proceedings. accordance with the rules appli- cable in that Member State.'

137. Considered in conjunction with the 'standstill' clause, this principle means, in the first place, that the Turkish Republic may not impose new restrictions on tem- porary activities that German undertakings wish to carry out in Turkey. However, this issue does not arise in the present cases. — The Turkish undertaking provides car- riage using its own lorries and its own drivers

138. For its part, the Federal Republic of Germany cannot create new impediments 141. This is a typical example of the to activities that Turkish road haulage provision of cross-border haulage services. undertakings wish to carry out in Germany.

142. The Federal Republic of Germany 139. It is not however clear whether, in the does not impose any obstacles to this as it main proceedings, the international haul- grants an exemption from the requirement age services are provided in the name and to have a work permit to 'travelling person- under the responsibility of Turkish under- nel working in... international carriage... takings that are subsidiaries of German for employers with registered offices

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abroad, where the vehicle is registered in Commission, may arise in the present case, the State of the employer's registered namely that of a hiring of the lorries by the office'. 25 German undertaking to the Turkish under- taking.

144. Since then, however, owners of lorries 147. At the hearing, the German Govern- registered in a Member State may obtain ment emphasised that from a time well licences authorising them to undertake an before the entry into force of the Additional unlimited number of journeys each year. Protocol undertakings established in third That may explain the attraction of these countries had not been granted authori- lorries for Turkish undertakings. sation to provide haulage services on Ger- man territory if their lorries were not registered in the country in which they were established. The Federal Republic of Germany had therefore not introduced any new restriction as regards rights relating to Turkish undertakings, but was instead better able subsequently to enforce, — The Turkish undertaking provides car- through the medium of work permits, an riage using its own drivers but with lorries old rule that had often been disregarded in which belong to a German undertaking and the past. which are registered in Germany

145. This corresponds to one of the two possible situations which, according to the 148. If the Court does not share my primary conclusion, it would be a matter for the national courts to reach a finding in 25 — Paragraph 9(2) of the AEVO, as amended, cited above at fact in relation to this question, which is point 16. clearly a decisive one.

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35 Furthermore, under Article 5(4) of Regulation No 881/92, the Community authorisation is to be made out in the haulier's name and he may not transfer it to any third party. It follows that 151. In that judgment, the Court stated as where vehicles originally used by a follows: road haulier holding a Community authorisation are then hired out to another road haulier, the lessor is not entitled to transfer the benefit of his own Community authorisation to the lessee.' '34 As regards carriage authorisations, according to the combined provisions of Articles 1(1) and 3(1) of Regulation No 881/92, a Community authori- sation is required to carry out the international carriage of goods by road for hire or reward within the territory of the Community and, pursuant to Article 5(1) and (2) of the same regu- 152. In its further reasoning in that judg- ment, the Court went on to state that under Article 2(1) of Council Directive 26—Joined Cases C-228/01 and C-289/01 [2002] F.CR 84/647/EEC of 19 December 1984 on the I-10213. use of vehicles hired without drivers for the

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carriage of goods by road, 27 as amended by 155. The principle of the freedom to pro- Council Directive 90/398/EEC of 24 July vide services may not be relied upon in 1990, 28 'each Member State is to allow the support of illegal activities and the fact that use within its territory of vehicles hired by Turkish workers driving those lorries undertakings established on the territory of would be required to obtain a German another Member State provided that, inter work permit could not amount to a restric- alia, the vehicles are registered or put into tion on the freedom to provide services. circulation in compliance with the laws in Article 41(1) of the Additional Protocol the Member State in which the haulier would quite simply not apply. lessee is established' (paragraph 40 of the judgment).

findings of fact which would enable a would arise if the Turkish drivers were in conclusion to be reached as to who the fact employees of the German undertaking. drivers' employer is have so far been lacking'. It goes on to ask whether it is relevant 'whether the workers concerned are employees of a Turkish employer only or whether another (German) employer may be involved, in whatever form, in the 162. The question therefore is whether the employment relationship'. fact that the German authorities require the Turkish drivers to have a work permit amounts to a restriction on the freedom to provide services to the prejudice of the German haulage undertaking if the latter is the employer of the drivers.

159. I should point out in that regard that according to the Court's settled case-law the essential feature of an employment relationship is that for a certain period of time a person performs services for and 163. I am of the view that this question under the direction of another person in falls to be answered in the negative. return for which he receives remuner- ation. 30

164. It should be noted in this regard that, to the extent that the requirement to have a work permit, imposed by the German authorities, affects German haulage under- 160. In the present case, it may be assumed takings, that can, seen from the perspective that the true position is that the drivers are of the freedom to provide services, amount principally given their instructions by Ger- at its highest to an obstacle to the exporting man undertakings, but it has not been of services by those undertakings. suggested that they are also paid by them.

paragraph of Article 59 of the EEC Treaty 169. As regards Article 30 of the EC Treaty in so far as it discriminates between persons (now, after amendment, Article 28 EC), providing transport services between a port which relates to restrictions on imports, the situated in national territory and a port Court held at paragraph 5 of the Dasson- situated in another Member State of the ville 32 judgment that '[a]ll trading rules Community and persons providing trans- enacted by Member States which are port services between two ports situated in capable of hindering, directly or indirectly, national territory'. 31 actually or potentially, intra-Community trade are to be considered as measures having an effect equivalent to quantitative restrictions'. The same broad definition of the concept of restrictions applies to the freedom to provide services, including 166. In the present case, the German legis- imports of services, as is shown inter alia lation is not discriminatory. The require- by paragraph 29 of the De Coster 33 judg- ment to have a work permit affects haulage ment, which states that 'Article 59 of the operations in the same way, whether the Treaty requires not only the elimination of German undertaking is providing transport all discrimination on grounds of nationality within Germany, to another Member State against providers of services who are or to Turkey. established in another Member State, but also the abolition of any restriction, even if it applies without distinction to national providers of services and to those of other Member States, which is liable to prohibit or further impede the activities of a pro- vider of services established in another 167. A measure of this kind, adopted by a Member State where he lawfully provides Member State, which affects without dis- similar services (see Case C-76/90 Säger tinction the provision by its own nationals [1991] ECR I-4221, paragraph 12; Case of services within the Member State, on the C-43/93 Vander Elst [1994] ECR I-3803, one hand, and the export by the same paragraph 14)'. nationals of the same services to another Member State or, as in the present case, to Turkey, on the other hand, does not con- stitute an obstacle to the freedom to pro- vide services.

provision concerns national measures whose relevant elements are confined which have as their specific object or effect within a single Member State...'. 36 the restriction of patterns of exports and thereby the establishment of a difference in treatment between the domestic trade of a Member State and its export trade in such a way as to provide a particular advantage for national production or for the domestic market of the State in question at the expense of the production or of the trade of 173. It follows from all the above that the other Member States...'. 35 fact that the German authorities require that Turkish drivers obtain a work permit cannot amount to an obstacle to the provision of cross-border services by Ger- man carriers who employ the drivers in question. Article 41(1) of the Additional Protocol does not apply in the circum- 171. Similarly, it is wrong in my opinion to stances considered above. treat national legislation as imposing an obstacle to the freedom to provide services unless it affects the import of services in a different way from that in which it affects the provision of services within the Member State.

— The Turkish drivers arc taken on and paid by a Turkish undertaking

172. Any other interpretation would have the result that the smallest obligation imposed by a Member State on its own nationals who are involved in the provision of services would amount to an obstacle to the freedom to provide services, as every 174. Since wc are proceeding on the one of those nationals would be a potential assumption of haulage operations for exporter of services. Such an argument which the German undertaking is respon- would leave no place for situations con- sible, now dealing with another form of the fined to the territory of a single Member provision of services, which may be termed State, whereas it is settled case-law that '... the making available of drivers. This is the the provisions of the Treaty on freedom to second possible situation which the Com- provide services cannot apply to activities mission suggests may arise in the main proceedings in this case.

177. In this regard, the German Govern- ment stated at the hearing that until 1972 there was in Germany a prohibition on 180. In the alternative, and supposing that making workers available ('Leiharbeit') to the making available of drivers were, an undertaking. This prohibition was sub- nevertheless, allowable in principle, the sequently removed, subject to certain con- question still arises as to whether, in fact, ditions as far as German workers and the circumstances involve the provision of workers from other Member States were services within the meaning of Article 50 concerned. It was retained for workers EC. from third countries, including Turkish workers.

178. According to the German Govern- 181. It is necessary to ask whether the ment, it follows that as the making avail- making available of drivers was really able of Turkish workers by a Turkish carried out 'temporarily' (following the undertaking to a German undertaking was expression used in Article 50 EC). It will prohibited before the entry into force of the be for the national courts to carry out the Additional Protocol, no new restriction was necessary factual analysis. I - 12340

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'It should be stated that, since the concept of the provision of services as defined by Article 60 of the Treaty covers very dif- ferent activities, the same conclusions are 186. Lastly, in this context, the Court's case-law should not be overlooked, accord- 37 — Case C-5J/94 [1995] ECR I-4165, paragraph 27. ing to which '... Community law does not 38 — Case 33/74 Van Binsbergen [1974] ECR 1299, paragraph preclude Member States from extending 13. See also Case 130/88 Van de Bijl [1989] ECR 3039, paragraph 26; Case C-211/91 Commission v Belgium their legislation, or collective labour agree- [1992] ECR I-6757, paragraph 12; Case C-148/91 Veronica Omroep Organisatie [1993] ECR I-487, para- ments entered into by both sides of indus- graph 12; and Case C-23/93 TV 10 [1994] ECR I-4795, paragraph 20. try, to any person who is employed, even 39 — Case C-113/89 [1990] ECR I-1417, paragraph 16. temporarily, within their territory, no

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matter in which country the employer is non-member State must not be given more established; nor does Community law pro- favourable treatment than undertakings hibit Member States from enforcing those established in a Member State'. rules by appropriate means' (Joined Cases 62/81 and 63/81 Seco and Desquenne [1982] ECR 223). 40

Article 1(4) of that directive states, more- over, that '[undertakings established in a

40 — Judgment in the Rush Portuguesa case, cited above in 191. I should point out again, however, footnote 39. that the foregoing line of reasoning has 41 — OJ 1997 L 18, p. 1. been provided in the alternative. I propose I - 12342

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therefore to reply to part (b) of the third 193. The Turkish drivers take the view that question raised in Case C-317/01 and to the they may rely on Article 41(1) of the first question raised in Case C-369/01 to Additional Protocol, on the basis that the the effect that Article 41(1) of the Addi- measure restricts the freedom of Turkish tional Protocol must be interpreted as transport undertakings to provide services meaning that it does not apply to national in the territory of a Member State and to legislation in the field of road transport that extent also affects the legal situation of operations of the kind in issue in the main the employees of those undertakings. proceedings.

194. For the German Government and for the Commission, Article 41(1) of the Proto- D — Part (a) of the third question referred col cannot be relied on by the workers. In for a preliminary ruling in Case C-317/01 the Commission's opinion, only an and part (a) of the first question referred for employer established in Turkey may raise a preliminary ruling in Case C-369/01 a breach of this provision of the EEC- Turkey Agreement before a national court. Such a right is not available to Turkish workers whose employer is established in 192. These questions are identical and fall Turkey nor to an undertaking established to be answered in the same way. The in the Member State concerned and which wording is as follows: is connected to the Turkish employer through a contract for services.

196. The French Government doubts that direct effect in Member States'. Were it to the Court's reasoning in the Clean Car apply in circumstances such as those arising Autoservice case 4 3 may be applied in these in the main proceedings, it could therefore cases, and that a worker who is employed be relied upon by Turkish undertakings in Turkey is entitled to rely on the 'stand- which make drivers available to German still' clause relating to the freedom to undertakings. provide services appearing in the Addi- tional Protocol to the Agreement. Firstly, Community law does not regulate the terms and conditions on which Turkish workers are taken on by employers in that country. Secondly, the taking-on of the workers in question by Turkish employers is not 200. I am of the view that it may also be necessarily connected to the right the latter relied upon by those drivers. have to provide services to the Community. As it is of the view that Article 41(1) of the Additional Protocol only applies to free- dom of establishment and the freedom to provide services, and not to access to employment, the French Government con- 201. In the Clean Car Autoservice judg- siders that the provision applies primarily ment, the Court held that an employer who to undertakings and not to their employees. wishes to take on as a manager a person previously residing in another Member State could rely on the principle of equal treatment in the field of the freedom of movement for workers, laid down under Article 48 of the EC Treaty (now, after 197. I mentioned above that in my opinion amendment, Article 39 EC) equally as Article 41(1) did not apply to circum- much as the manager himself. stances such as those arising in the main proceedings.

204. To paraphrase the Clean Car Auto- service judgment, one might say that in order to be truly effective, the right of undertakings to provide services without discrimination necessarily entails as a E — The second question referred for a corollary the workers' entitlement to carry preliminary riding in Case C-369/01 out the duties entrusted to them in the field of service provision. The rules relating to the freedom to provide services could easily be rendered nugatory if Member States 207. This question reads as follows: could circumvent the prohibitions which they contain merely by imposing on workers requirements to be met in order to carry out their duties as employees which, if imposed directly on the under- 'Does such a restriction concern exclusively takings which employed them, would con- the freedom to provide services or does it stitute restrictions on the exercise of the also or solely concern conditions of access

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to employment within the meaning of 209. I would add by way of obiter dictum Article 13 of Decision No 1/80...?' that there is a solution that would avoid the Turkish drivers becoming unemployed and German undertakings having to take on drivers who are familiar neither with the Turkish language nor with local customs. It 208. It follows from the reasoning set out would consist in giving those drivers a above that neither Article 41(1) of the work permit limited to the situation where Additional Protocol nor Article 13 of they were employed by German undertak- Decision No 1/80 may be relied on in the ings under German employment and social present case. It is therefore unnecessary to security law. answer this question.

(2) Article 13 of Decision No 1/80 of the Association Council does not apply to Turkish workers employed by an employer with its seat in Turkey and who, as long-distance lorry drivers engaged in international haulage, regularly pass through a Member State of the Community without belonging to the legitimate labour force of that Member State.

(3) Article 41(1) of the Additional Protocol to the Agreement establishing an Association between the European Economic Community and Turkey must be interpreted as meaning that it does not apply to national legislation in the field of road transport operations of the kind in issue in the main proceedings.

(4) To the extent that Article 41(1) of the Additional Protocol applies in circumstances such as those arising in the main proceedings, it must be interpreted as meaning that a Turkish worker is entitled to plead a new restriction on the freedom to provide services which his employer wishes to make available.

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