The "four freedoms" of the single market are: • Free movement of goods • Free movement of capital • Freedom to establish and provide services • Free movement of labour.
Goods The range of "goods" (or "products") covered by the term "free movement of goods" "is as wide as the range of goods in existence". Goods are only covered if they have economic value, i.e. they can be valued in money and are capable of forming the subject of commercial transactions.
Works of art,
coins which are no longer in circulation and water are noted as examples of "goods". Council Regulation (EC) 2679/98 of 7 December 1998, on the functioning of the internal market in relation to the
free movement of goods among the Member States, was aimed at preventing obstacles to the free movement of goods attributable to "action or inaction" by a Member State. The regulation empowered the commission to request intervention by a Member State when the actions of private individuals were creating an "obstacle" to free movement of goods. A resolution was adopted by the council and member state government representatives on the same day, under which the member states agreed to take action where necessary to protect the free movement of goods and other freedoms, and to issue public information where there were disruptions, including their efforts to address obstacles to free movement of goods.
Customs duties and taxation The
customs union of the European Union removes customs barriers between member states and operates a common customs policy towards third countries, with the aim "to ensure normal conditions of competition and to remove all restrictions of a fiscal nature capable of hindering the free movement of goods within the Common Market". Aspects of the EU Customs area extend to a number of non-EU-member states, namely
Andorra,
Monaco,
San Marino and Turkey, under separately negotiated arrangements. The United Kingdom agreed on a trade deal with the European Union on 24 December 2020, which was signed by
Prime Minister Boris Johnson on 30 December 2020.
Customs duties Article 30 of the Treaty on the Functioning of the European Union ("TFEU") prohibits border levies between member states on both
European Union Customs Union produce and non-EUCU (third-country) produce. Under Article 29 of the TFEU, customs duty applicable to third country products are levied at the point of entry into EUCU, and once within the EU external border goods may circulate freely between member states. Under the operation of the
Single European Act, customs border controls between member states have been largely abandoned. Physical inspections on imports and exports have been replaced mainly by audit controls and risk analysis.
Charges having equivalent effect to customs duties Article 30 of the TFEU prohibits not only customs duties but also charges having equivalent effect. The
European Court of Justice defined "charge having equivalent effect" in
Commission v Italy. A charge is a customs duty if it is proportionate to the value of the goods; if it is proportionate to the quantity, it is a charge having equivalent effect to a customs duty. There are three exceptions to the prohibition on charges imposed when goods cross a border, listed in Case 18/87 Commission v Germany. A charge is not a customs duty or charge having equivalent effect if: • it relates to a general system of internal dues applied systematically and in accordance with the same criteria to domestic products and imported products alike, • if it constitutes payment for a service in fact rendered to the economic operator of a sum in proportion to the service, or • subject to certain conditions, if it attaches to inspections carried out to fulfil obligations imposed by Union law.
Taxation Article 110 of the TFEU provides: In the
taxation of rum case, the ECJ stated that:
Quantitative and equivalent restrictions Free movement of goods within the
European Union is achieved by a
customs union and the principle of non-discrimination. The EU manages imports from non-member states, duties between member states are prohibited, and imports circulate freely. In addition under the
Treaty on the Functioning of the European Union article 34, 'Quantitative restrictions on imports and all
measures having equivalent effect shall be prohibited between Member States'. In
Procureur du Roi v Dassonville the
Court of Justice held that this rule meant all "trading rules" that are "enacted by Member States" which could hinder trade "directly or indirectly, actually or potentially" would be caught by article 34. This meant that a
Belgian law requiring
Scotch whisky imports to have a certificate of origin was unlikely to be lawful. It discriminated against parallel importers like Mr Dassonville, who could not get certificates from authorities in France, where they bought the
Scotch. This "wide test", to determine what could potentially be an unlawful restriction on trade, applies equally to actions by quasi-government bodies, such as the former "
Buy Irish" company that had government appointees. It also means states can be responsible for private actors. For instance, in
Commission v France French farmer vigilantes were continually sabotaging shipments of Spanish
strawberries, and even Belgian tomato imports. France was liable for these hindrances to trade because the authorities "manifestly and persistently abstained" from preventing the sabotage. Generally speaking, if a member state has laws or practices that directly discriminate against imports (or exports under
TFEU article 35) then it must be justified under article 36, which outlines all of the justifiable instances. The justifications include public
morality, policy or security, "protection of health and life of
humans, animals or plants", "national treasures" of "artistic, historic or archaeological value" and "industrial and commercial property". In addition, although not clearly listed, environmental protection can justify restrictions on trade as an over-riding requirement derived from
TFEU article 11. The
Eyssen v Netherlands case from 1981 outlined a disagreement between the science community and the Dutch government whether niacin in cheese posed a public risk. As public risk falls under article 36, meaning that a quantitative restriction can be imposed, it justified the import restriction against the Eyssen cheese company by the Dutch government. More generally, it has been increasingly acknowledged that fundamental human rights should take priority over all trade rules. So, in
Schmidberger v Austria the
Court of Justice held that
Austria did not infringe article 34 by failing to ban a protest that blocked heavy traffic passing over the A13,
Brenner Autobahn, en route to Italy. Although many companies, including Mr Schmidberger's German undertaking, were prevented from trading, the
Court of Justice reasoned that
freedom of association is one of the "fundamental pillars of a democratic society", against which the free movement of goods had to be balanced, and was probably subordinate. If a member state does appeal to the article 36 justification, the measures it takes have to be applied
proportionately. This means the rule must be pursue a legitimate aim and (1) be
suitable to achieve the aim, (2) be necessary, so that a less restrictive measure could not achieve the same result, and (3) be
reasonable in balancing the interests of free trade with interests in article 36. '', protests blocked trucks for goods through the
Austrian Alps on the
Brenner Autobahn. The Court of Justice recognised fundamental rights take priority over free trade. Often rules apply to all goods neutrally, but may have a greater practical effect on imports than domestic products. For such "indirect" discriminatory (or "indistinctly applicable") measures the
Court of Justice has developed more justifications: either those in article 36, or additional "mandatory" or "overriding" requirements such as
consumer protection, improving
labour standards, protecting the environment, press diversity, fairness in commerce, and more: the categories are not closed. In the most famous case
Rewe-Zentral AG v Bundesmonopol für Branntwein, the
Court of Justice found that a German law requiring all spirits and liqueurs (not just imported ones) to have a minimum alcohol content of 25 per cent was contrary to
TFEU article 34, because it had a greater negative effect on imports. German liqueurs were over 25 per cent alcohol, but
Cassis de Dijon, which Rewe-Zentrale AG wished to import from France, only had 15 to 20 per cent alcohol. The Court of Justice rejected the German government's arguments that the measure proportionately protected public health under
TFEU article 36, because stronger beverages were available and adequate labelling would be enough for consumers to understand what they bought. This rule primarily applies to requirements about a product's content or packaging. In
Walter Rau Lebensmittelwerke v De Smedt PVBA the
Court of Justice found that a Belgian law requiring all
margarine to be in
cube shaped packages infringed article 34, and was not justified by the pursuit of consumer protection. The argument that Belgians
would believe it was butter if it was not cube shaped was disproportionate: it would "considerably exceed the requirements of the object in view" and labelling would protect consumers "just as effectively". In a 2003 case,
Commission v Italy, Italian law required that cocoa products that included other
vegetable fats could not be labelled as "chocolate". It had to be "chocolate substitute". All Italian chocolate was made from
cocoa butter alone, but British, Danish and Irish manufacturers used other vegetable fats. They claimed the law infringed article 34. The
Court of Justice held that a low content of vegetable fat did not justify a "chocolate substitute" label. This was derogatory in the consumers' eyes. A "neutral and objective statement" was enough to protect consumers. If member states place considerable obstacles on the use of a product, this can also infringe article 34. So, in a 2009 case,
Commission v Italy, the
Court of Justice held that an Italian law prohibiting motorcycles or mopeds from pulling trailers infringed article 34. Again, the law applied neutrally to everyone, but disproportionately affected importers, because Italian companies did not make trailers. This was not a product requirement, but the Court reasoned that the prohibition would deter people from buying it: it would have "a considerable influence on the behaviour of consumers" that "affects the
access of that product to the market". It would require justification under article 36, or as a mandatory requirement. In contrast to product requirements or other laws that hinder
market access, the
Court of Justice developed a presumption that "selling arrangements" would be presumed to not fall into
TFEU article 34, if they applied equally to all sellers, and affected them in the same manner in fact. In
Keck and Mithouard two importers claimed that their prosecution under a French
competition law, which prevented them from selling
Picon beer under wholesale price, was unlawful. The aim of the law was to prevent
cut throat competition, not to hinder trade. The
Court of Justice held, as "in law and in fact" it was an equally applicable "selling arrangement" (not something that alters a product's content) it was outside the scope of article 34, and so did not need to be justified. Selling arrangements can be held to have an unequal effect "in fact" particularly where traders from another member state are seeking to break into the market, but there are restrictions on advertising and marketing. In
Konsumentombudsmannen v De Agostini the
Court of Justice reviewed
Swedish bans on
advertising to children under age 12, and misleading commercials for skin care products. While the bans have remained (justifiable under article 36 or as a mandatory requirement) the Court emphasised that complete marketing bans could be disproportionate if advertising were "the only effective form of promotion enabling [a trader] to penetrate" the market. In
Konsumentombudsmannen v Gourmet AB the Court suggested that a total ban for advertising alcohol on the radio, TV and in magazines could fall within article 34 where advertising was the only way for sellers to overcome consumers' "traditional social practices and to local habits and customs" to buy their products, but again the national courts would decide whether it was justified under article 36 to protect public health. Under the
Unfair Commercial Practices Directive, the EU harmonised restrictions on restrictions on marketing and advertising, to forbid conduct that distorts average consumer behaviour, is misleading or aggressive, and sets out a list of examples that count as unfair. Increasingly, states have to give
mutual recognition to each other's standards of regulation, while the EU has attempted to harmonise minimum ideals of best practice. The attempt to raise standards is hoped to avoid a regulatory "
race to the bottom", while allowing consumers access to goods from around the continent.
Capital Free movement of
capital was traditionally seen as the fourth freedom, after goods, workers and persons, services and establishment. The original
Treaty of Rome required that restrictions on free capital flows only be removed to the extent necessary for the common market. From the
Maastricht Treaty, now in
TFEU article 63, "all restrictions on the movement of capital between the Member States and between Member States and third countries shall be prohibited". This means
capital controls of various kinds are prohibited, including limits on buying currency, limits on buying
company shares or financial assets, or government approval requirements for
foreign investment. By contrast, taxation of capital, including
corporate tax,
capital gains tax and
financial transaction tax, are not affected so long as they do not discriminate by nationality. According to the
Capital Movement Directive 1988, Annex I, 13 categories of capital which must move free are covered. In
Baars v Inspecteur der Belastingen Particulieren the
Court of Justice held that for investments in companies, the capital rules, rather than freedom of establishment rules, were engaged if an investment did not enable a "definite influence" through shareholder voting or other rights by the investor. That case held a Dutch Wealth Tax Act 1964 unjustifiably exempted Dutch investments, but not Mr Baars' investments in an Irish company, from the tax: the wealth tax, or exemptions, had to be applied equally. On the other hand,
TFEU article 65(1) does not prevent taxes that distinguish taxpayers based on their residence or the location of an investment (as taxes commonly focus on a person's actual source of profit) or any measures to prevent
tax evasion. Apart from tax cases, largely following from the opinions of
Advocate General Maduro, a series of cases held that government owned
golden shares were unlawful. In
Commission v Germany the Commission claimed the German
Volkswagen Act 1960 violated article 63, in that §2(1) restricted any party having voting rights exceeding 20% of the company, and §4(3) allowed a minority of 20% of shares held by the
Lower Saxony government to block any decisions. Although this was not an impediment to the actual purchase of shares, or receipt of dividends by any shareholder, the
Court of Justice's Grand Chamber agreed that it was disproportionate for the government's stated aim of protecting workers or minority shareholders. Similarly, in
Commission v Portugal the
Court of Justice held that
Portugal infringed free movement of capital by retaining golden shares in
Portugal Telecom that enabled disproportionate voting rights, by creating a "deterrent effect on portfolio investments" and reducing "the attractiveness of an investment". This suggested the Court's preference that a government, if it sought public ownership or control, should nationalise in full the desired proportion of a company in line with
TFEU article 345. Capital within the EU may be transferred in any amount from one country to another (except that Greece currently has
capital controls restricting outflows, and Cyprus imposed capital controls between 2013 and April 2015). All intra-EU transfers in
euro are considered as domestic payments and bear the corresponding domestic transfer costs. This includes all member States of the EU, even those outside the
eurozone providing the transactions are carried out in euro. Credit/debit card charging and ATM withdrawals within the Eurozone are also charged as domestic; however, paper-based payment orders, like cheques, have not been standardised so these are still domestic-based. The ECB has also set up a
clearing system,
T2 since March 2023, for large euro transactions. The final stage of completely free movement of capital was thought to require a
single currency and
monetary policy, eliminating the
transaction costs and fluctuations of currency exchange. Following a Report of the
Delors Commission in 1988, the
Maastricht Treaty made
economic and monetary union an objective, first by completing the internal market, second by creating a
European System of Central Banks to co-ordinate common monetary policy, and third by locking exchange rates and introducing a single currency, the
euro. Today, 20 member states have adopted the
euro, one is in the process of adopting (
Bulgaria), one has determined to opt-out (
Denmark) and 5 member states have delayed their accession, particularly since the
Eurozone crisis. According to
TFEU articles 119 and 127, the objective of the
European Central Bank and other central banks ought to be
price stability. This has been criticised for apparently being superior to the objective of
full employment in the
Treaty on European Union article 3. Within the building on the Investment Plan for Europe, for a closer integration of capital markets, in 2015, the Commission adopted the Action Plan on Building a
Capital Markets Union (CMU) setting out a list of key measures to achieve a true single market for capital in Europe, which deepens the existing Banking Union, because this revolves around disintermediated, market-based forms of financing, which should represent an alternative to the traditionally predominant (in Europe) bank-based financing channel. The EU's political and economic context call for strong and competitive capital markets to finance the EU economy. The CMU project is a political signal to strengthen the single market as a project of all 28 Member States, instead of just the Eurozone countries, and sent a strong signal to the UK to remain an active part of the EU, before Brexit.
Services As well as creating rights for "workers" who generally
lack bargaining power in the market, the
Treaty on the Functioning of the European Union or TFEU also protects the "freedom of establishment" in article 49, and "
freedom to provide services" in article 56.
Establishment In
Gebhard v Consiglio dell’Ordine degli Avvocati e Procuratori di Milano the
Court of Justice held that to be "established" means to participate in economic life "on a stable and continuous basis", while providing "services" meant pursuing activity more "on a temporary basis". This meant that a lawyer from
Stuttgart, who had set up chambers in
Milan and was censured by the Milan Bar Council for not having registered, should claim for breach of establishment freedom, rather than service freedom. However, the requirements to be registered in Milan before being able to practice would be allowed if they were non-discriminatory, "justified by imperative requirements in the general interest" and proportionately applied. All people or entities that engage in economic activity, particularly the self-employed, or "undertakings" such as companies or firms, have a right to set up an enterprise without unjustified restrictions. The
Court of Justice has held that both a member state government and a private party can hinder freedom of establishment, so article 49 has both "vertical" and "horizontal" direct effect. In
Reyners v Belgium the Court of Justice held that a refusal to admit a lawyer to the Belgian bar because he lacked
Belgian nationality was unjustified.
TFEU article 49 says states are exempt from infringing others' freedom of establishment when they exercise "official authority", but this did an advocate's work (as opposed to a court's) was not official. By contrast in
Commission v Italy the Court of Justice held that a requirement for lawyers in Italy to comply with maximum tariffs unless there was an agreement with a client was not a restriction. The
Grand Chamber of the Court of Justice held the commission had not proven that this had any object or effect of limiting practitioners from entering the market. Therefore, there was no
prima facie infringement freedom of establishment that needed to be justified. in
Centros Ltd held that people can establish a
UK company or any other, to do business EU-wide, but must comply with proportionate requirements in the public interest, such as the basic labour right to a
voice at work. In regard to companies, the
Court of Justice held in
R (Daily Mail and General Trust plc) v HM Treasury that member states could restrict a company moving its seat of business, without infringing
TFEU article 49. This meant the
Daily Mail newspaper's
parent company could not
avoid tax by shifting its residence to the
Netherlands without first settling its tax bills in the UK. The UK did not need to justify its action, as rules on company seats were not yet harmonised. By contrast, in
Centros Ltd v Erhvervs- og Selkabssyrelsen the Court of Justice found that a UK
limited company operating in
Denmark could not be required to comply with Denmark's
minimum share capital rules. UK law only required £1 of capital to start a company, while Denmark's legislature took the view companies should only be started up if they had 200,000
Danish krone (around €27,000) to protect
creditors if the company failed and went
insolvent. The
Court of Justice held that Denmark's minimum capital law infringed Centros Ltd's freedom of establishment and could not be justified, because a company in the UK could admittedly provide services in Denmark without being established there, and there were less restrictive means of achieving the aim of creditor protection. This approach was criticised as potentially opening the EU to unjustified
regulatory competition, and a
race to the bottom in standards, like in the US where the state of
Delaware attracts most companies and is often argued to have the worst standards of accountability of boards, and low corporate taxes as a result. Similarly in
Überseering BV v Nordic Construction GmbH the Court of Justice held that a German court could not deny a Dutch building company the right to enforce a contract in Germany on the basis that it was not validly incorporated in Germany. Although restrictions on freedom of establishment could be justified by creditor protection, labour rights to participate in work, or the public interest in collecting taxes, denial of capacity went too far: it was an "outright negation" of the right of establishment. However, in
Cartesio Oktató és Szolgáltató bt the Court of Justice affirmed again that because corporations are created by law, they are in principle subject to any rules for formation that a state of incorporation wishes to impose. This meant that the Hungarian authorities could prevent a company from shifting its central administration to Italy while it still operated and was incorporated in Hungary. Thus, the court draws a distinction between the right of establishment for foreign companies (where restrictions must be justified), and the right of the state to determine conditions for companies incorporated in its territory, although it is not entirely clear why.
Types of service The "freedom to provide services" under
TFEU article 56 applies to people who provide services "for remuneration", especially in commercial or professional activity. For example, in
Van Binsbergen v Bestuur van de Bedrijfsvereniging voor de Metaalnijverheid a Dutch lawyer moved to Belgium while advising a client in a
social security case, and was told he could not continue because Dutch law said only people established in the Netherlands could give legal advice. The
Court of Justice held that the freedom to provide services applied, it was directly effective, and the rule was probably unjustified: having an address in the member state would be enough to pursue the legitimate aim of good administration of justice.
Case law states that the treaty provisions relating to the freedom to provide services do not apply in situations where the service, service provider and other relevant facts are confined within a single member state. An early Council Directive from 26 July 1971 included works contracts within the scope of services, and provided for the abolition of restrictions on the freedom to provide services in respect of public works contracts. The Court of Justice has held that
secondary education falls outside the scope of article 56, because usually the state funds it, though higher education does not. Health care generally counts as a service. In
Geraets-Smits v Stichting Ziekenfonds Mrs Geraets-Smits claimed she should be reimbursed by Dutch social insurance for the costs of receiving treatment in Germany. The Dutch health authorities regarded the treatment as unnecessary, so she argued this restricted the freedom (of the German health clinic) to provide services. Several governments submitted that hospital services should not be regarded as economic, and should not fall within article 56. But the
Court of Justice held that health care was a "service" even though the government (rather than the service recipient) paid for the service. National authorities could be justified in refusing to reimburse patients for medical services abroad if the health care received at home was without undue delay, and it followed "international medical science" on which treatments counted as normal and necessary. The Court requires that the individual circumstances of a patient justify waiting lists, and this is also true in the context of the UK's
National Health Service. Aside from public services, another sensitive field of services are those classified as illegal.
Josemans v Burgemeester van Maastricht held that the Netherlands' regulation of
cannabis consumption, including the prohibitions by some municipalities on tourists (but not Dutch nationals) going to
coffee shops, fell outside article 56 altogether. The
Court of Justice reasoned that narcotic drugs were controlled in all member states, and so this differed from other cases where prostitution or other quasi-legal activity was subject to restriction. If an activity does fall within article 56, a restriction can be justified under article 52 or over-riding requirements developed by the Court of Justice. In
Alpine Investments BV v Minister van Financiën a business that sold
commodities futures (with
Merrill Lynch and another banking firm) attempted to challenge a Dutch law prohibiting
cold calling customers. The Court of Justice held the Dutch prohibition pursued a legitimate aim to prevent "undesirable developments in securities trading" including protecting the consumer from aggressive sales tactics, thus maintaining confidence in the Dutch markets. In
Omega Spielhallen GmbH v Bonn, a "laserdrome" business was banned by the
Bonn council. It bought fake laser gun services from a UK firm called Pulsar Ltd, but residents had protested against "playing at killing" entertainment. The Court of Justice held that the German constitutional value of
human dignity, which underpinned the ban, did count as a justified restriction on the freedom to provide services. In
Liga Portuguesa de Futebol v Santa Casa da Misericórdia de Lisboa the Court of Justice also held that the state monopoly on gambling, and a penalty for a
Gibraltar firm that had sold internet gambling services, was justified to prevent fraud and gambling where people's views were highly divergent. The ban was proportionate as this was an appropriate and necessary way to tackle the serious problems of fraud that arise over the internet. In the
Services Directive a group of justifications were codified in article 16 that the case law has developed.
Digital Single Market In May 2015 the
Juncker Commission announced a plan to reverse the fragmentation of internet shopping and other online services by establishing a Single Digital Market that would cover digital services and goods from e-commerce to parcel delivery rates, uniform telecoms and copyright rules.
People The free movement of people means
EU citizens can move freely between member states for whatever reason (or without any reason) and may reside in any member state they choose if they are not an undue burden on the social welfare system or public safety in their chosen member state. This required reduction of administrative formalities and greater recognition of professional qualifications of other states. Fostering the free movement of people has been a major goal of European integration since the 1950s. Broadly defined, this freedom enables citizens of one Member State to travel to another, to reside and to work there (permanently or temporarily). The idea behind EU legislation in this field is that citizens from other member states should be treated equally to domestic citizens and should not be discriminated against. The main provision on the freedom of movement of persons is Article 45 of the TFEU, which prohibits restrictions on the basis of nationality.
Free movement of workers Since its foundation, the Treaties sought to enable people to pursue their life goals in any country through free movement. Reflecting the economic nature of the project, the
European Community originally focused upon free movement of workers: as a "
factor of production". However, from the 1970s, this focus shifted towards developing a more "social" Europe. Free movement was increasingly based on "
citizenship", so that people had rights to empower them to become economically and socially active, rather than economic activity being a precondition for rights. This means the basic "worker" rights in
TFEU article 45 function as a specific expression of the general rights of citizens in
TFEU articles 18 to 21. According to the
Court of Justice, a "worker" is anybody who is economically active, which includes everyone in an employment relationship, "under the direction of another person" for "remuneration". A job, however, need not be paid in money for someone to be protected as a worker. For example, in
Steymann v Staatssecretaris van Justitie, a German man claimed the right to residence in the Netherlands, while he volunteered plumbing and household duties in the
Bhagwan community, which provided for everyone's material needs irrespective of their contributions. The
Court of Justice held that Mr Steymann was entitled to stay, so long as there was at least an "indirect quid pro quo" for the work he did. Having "worker" status means protection against all forms of discrimination by governments, and employers, in access to employment, tax, and
social security rights. By contrast a citizen, who is "any person having the nationality of a Member State" (
TFEU article 20(1)), has rights to seek work, vote in local and European elections, but more restricted rights to claim
social security. In practice, free movement has become politically contentious as nationalist political parties appear to have utilised concerns about immigrants taking jobs and benefits. '' the
Court of Justice gave "horizontal
direct effect" to free movement, so a bank could not refuse employment to a worker who lacked a language certificate that could only be obtained in
Bolzano. The
Free Movement of Workers Regulation articles 1 to 7 set out the main provisions on equal treatment of workers. First, articles 1 to 4 generally require that workers can take up employment, conclude contracts, and not suffer discrimination compared to nationals of the member state. In a famous case, the
Belgian Football Association v Bosman, a Belgian footballer named
Jean-Marc Bosman claimed that he should be able to transfer from
R.F.C. de Liège to
USL Dunkerque when his contract finished, regardless of whether Dunkerque could afford to pay Liège the habitual transfer fees. The Court of Justice held "the transfer rules constitute[d] an obstacle to free movement" and were unlawful unless they could be justified in the public interest, but this was unlikely. In
Groener v Minister for Education the Court of Justice accepted that a requirement to speak
Gaelic to teach in a
Dublin design college could be justified as part of the public policy of promoting the Irish language, but only if the measure was not disproportionate. By contrast in
Angonese v Cassa di Risparmio di Bolzano SpA a bank in
Bolzano, Italy, was not allowed to require Mr Angonese to have a bilingual certificate that could only be obtained in Bolzano. The Court of Justice, giving "horizontal" direct effect to
TFEU article 45, reasoned that people from other countries would have little chance of acquiring the certificate, and because it was "impossible to submit proof of the required linguistic knowledge by any other means", the measure was disproportionate. Second, article 7(2) requires equal treatment in respect of tax. In
Finanzamt Köln Altstadt v Schumacker the Court of Justice held that it contravened
TFEU art 45 to deny tax benefits (e.g. for married couples, and social insurance expense deductions) to a man who worked in Germany, but was resident in Belgium when other German residents got the benefits. By contrast in
Weigel v Finanzlandesdirektion für Vorarlberg the Court of Justice rejected Mr Weigel's claim that a re-registration charge upon bringing his car to Austria violated his right to free movement. Although the tax was "likely to have a negative bearing on the decision of migrant workers to exercise their right to freedom of movement", because the charge applied equally to Austrians, in absence of EU legislation on the matter it had to be regarded as justified. Third, people must receive equal treatment regarding "social advantages", although the Court has approved residential qualifying periods. In
Hendrix v Employee Insurance Institute the Court of Justice held that a Dutch national was not entitled to continue receiving incapacity benefits when he moved to Belgium, because the benefit was "closely linked to the socio-economic situation" of the Netherlands. Conversely, in
Geven v Land Nordrhein-Westfalen the Court of Justice held that a Dutch woman living in the Netherlands, but working between 3 and 14 hours a week in Germany, did not have a right to receive German child benefits, even though the wife of a man who worked full-time in Germany but was resident in Austria could. The general justifications for limiting free movement in
TFEU article 45(3) are "public policy, public security or public health", and there is also a general exception in article 45(4) for "employment in the public service". For workers not citizens of the union but employed in one member state with a work permit, there is not the same freedom of movement within the Union. They need to apply for a new work permit if wanting to work in a different state. A facilitation mechanism for this process is the
Van Der Elst visa which gives easier rules should a non-EU worker already in one EU state need to be sent to another, for the same employer, because of a service contract that the employer made with a customer in that other state.
Free movement of citizens Beyond the right of free movement to work, the EU has increasingly sought to guarantee rights of citizens, and rights simply by being a
human being. But although the
Court of Justice stated that 'Citizenship is destined to be the fundamental status of nationals of the Member States', political debate remains on who should have access to public services and welfare systems funded by taxation. In 2008, just 8 million people from 500 million EU citizens (1.7 per cent) had in fact exercised rights of free movement, the vast majority of them workers. According to
TFEU article 20, citizenship of the EU derives from nationality of a member state. Article 21 confers general rights to free movement in the EU and to reside freely within limits set by legislation. This applies for citizens and their immediate family members. This triggers four main groups of rights: (1) to enter, depart and return, without undue restrictions, (2) to reside, without becoming an unreasonable burden on social assistance, (3) to vote in local and European elections, and (4) the right to equal treatment with nationals of the host state, but for social assistance only after 3 months of residence. (1961–1989) symbolised a bordered globe, where citizens of East Germany had no right to leave, and few could enter . The EU has progressively dismantled barriers to free movement, consistent with economic development. First, article 4 of the
Citizens Rights Directive 2004 says every citizen has the right to depart a member state with a valid
passport or
national identity card. Article 5 gives every citizen a right of entry, subject to national border controls.
Schengen Area countries (of which Ireland is not included) have abolished the need to show travel documents, and police searches at borders, altogether. These reflect the general principle of free movement in
TFEU article 21. Second, article 6 allows every citizen to stay three months in another member state, whether economically active or not. Article 7 allows stays over three months with evidence of "sufficient resources... not to become a burden on the social assistance system". Articles 16 and 17 give a right to permanent residence after 5 years without conditions. Third,
TEU article 10(3) requires the right to vote in the local constituencies for the
European Parliament wherever a citizen lives. , education,
social security and other assistance in EU member states. To ensure people contribute fairly to the communities they live in, there can be qualifying periods of residence and work up to five years. Fourth, and more debated, article 24 requires that the longer an EU citizen stays in a host state, the more rights they have to access public and welfare services, on the basis of
equal treatment. This reflects general principles of equal treatment and citizenship in
TFEU articles 18 and 20. In a simple case, in
Sala v Freistaat Bayern the
Court of Justice held that a Spanish woman who had lived in (Germany) for 25 years and had a baby was entitled to
child support, without the need for a residence permit, because Germans did not need one. In
Trojani v Centre public d’aide sociale de Bruxelles, a French man who lived in Belgium for two years was entitled to the "minimex" allowance from the state for a minimum living wage. In
Grzelczyk v Centre Public d’Aide Sociale d’Ottignes-Louvain-la-Neuve a French student, who had lived in Belgium for three years, was entitled to receive the "minimex" income support for his fourth year of study. Similarly, in
R (Bidar) v London Borough of Ealing the
Court of Justice held that it was lawful to require a French
UCL economics student to have lived in the UK for three years before receiving a student loan, but not that he had to have additional "settled status". Similarly, in
Commission v Austria, Austria was not entitled to restrict its university places to Austrian students to avoid "structural, staffing and financial problems" if (mainly German) foreign students applied, unless it proved there was an actual problem. However, in
Dano v Jobcenter Leipzig, the Court of Justice held that the German government was entitled to deny
child support to a Romanian mother who had lived in Germany for 3 years, but had never worked. Because she lived in Germany for over 3 months, but under 5 years, she had to show evidence of "sufficient resources", since the Court reasoned the right to equal treatment in article 24 within that time depended on lawful residence under article 7.
Schengen Area Within the
Schengen Area, 25 of the EU member states (excluding
Cyprus, and
Ireland) and the four
EFTA members (
Iceland,
Liechtenstein,
Norway, and
Switzerland) have abolished physical barriers across the single market by eliminating border controls. In 2015, limited controls were temporarily re-imposed at some internal borders in response to the
migrant crisis. ==Public sector procurement of goods and services==