The future of labor law in Europe: The Commission's public consultation

The Commission has launched a debate on the future of labor law in Europe and how it can be modified to help promote economic growth. It has published a "Green Paper" entitled "Modernizing labour law to meet the challenges of the 21st century" (COM(2006) 708 final). You can download the whole thing here.

You've just go to wonder on which planet the Commission lives. It rambles on with neologisms like "flexicurity". Better to click here or read this economics blog regularly.

But enough of that. The interesting thing is that the Commission is venturing far beyond the free movement of workers in its Green Paper.

Citizenship and war pensions: Case C-192/05

The Court of Justice handed down a neat judgment on citizenship and Article 18 EC. It held in Case C-192/05 Tas-Hagen and Tas that Article 18(1) EC precludes legislation of a member State under which it refuses to grant to one of its nationals a benefit for civilian war victims solely on the ground that, at the time at which the application was submitted, the person concerned was resident, not in the territory of that member State, but in the territory of another member State.

The story is as follows. Mrs Tas-Hagen was born in 1943 in what was at the time the Dutch East Indies. She moved to the Netherlands in 1954. In 1961 she acquired Netherlands nationality. In 1987, after having become incapable of working and thereby forced to terminate her professional career, she took up residence in Spain. In 1999, while resident in Spain, Mrs Tas-Hagen applied for the grant of a war pension. This application was based on health problems resulting from her experiences in the Dutch East Indies during the Japanese occupation and during the Bersiap period following that occupation. Her application was denied on the ground that the relevant Dutch legislation required the applicant for the war pension to be actually resident in the Netherlands and she was not because she was resident in Spain at the time.

As for Mr Tas, he was born in the Dutch East Indies in 1931. In 1947 he took up residence in the Netherlands. From 1951 to 1971 he held Indonesian nationality. He regained Netherlands nationality in 1971. In 1983 he ceased to be employed as an official of the Hague municipal council, and he was declared wholly incapable of work on grounds of mental health. In 1987 Mr Tas took up residence in Spain. He too applied for a war pension in 1999 and was also turned down on the ground that he was resident in Spain, not the Netherlands, at the time of the application.

They both challenged the refusal before the Dutch courts on the ground that the condition of residence in the Netherlands at the time of the applications is contrary to the Treaty provisions on citizenship of the Union. The Dutch court then referred the matter to the Court of Justice.

The Court had first to determine whether the facts of the case came within the scope of EC law. The Court held that they did. It stated that a benefit such as that in issue in the main proceedings, which is intended to compensate civilian war victims for physical or mental damage which they have suffered, falls within the competence of the member States. But, member States must exercise that competence in accordance with Community law, in particular with the Treaty provisions giving every citizen of the Union the right to move and reside freely within the territory of the member States. The Court pointed out that while citizenship of the Union, established by Article 17 EC, is not intended to extend the material scope of the Treaty to internal situations which have no link with Community law (Joined Cases C‑64/96 and C‑65/96 Uecker and Jacquet, paragraph 23, and Case C‑148/02 Garcia Avello, paragraph 26), the situation of Ms Tas-Hagen and Mr Tas is covered by the right of free movement and residence of citizens of the European Union. Clearly, Ms Tas-Hagen and Mr Tas, in taking up residence in Spain, were exercising the right granted by Article 18(1) EC to every citizen of the Union to move and reside freely within the territory of a Member State other than that of which he is a national.

Then the Court considered whether the residence requirement laid down in Dutch law was contrary to EC law. The Court held that it was contrary to EC law. The Court recalled that the opportunities offered by the Treaty in relation to freedom of movement cannot be fully effective if a national of a member State can be deterred from availing himself of them by obstacles raised to his residence in the host Member State by legislation of his State of origin penalizing the fact that he has used them (Case C‑224/02 Pusa, paragraph 19). It held that national legislation which places at a disadvantage certain of the nationals of the Member State concerned simply because they have exercised their freedom to move and to reside in another Member State is a restriction on the freedoms conferred by Article 18(1) EC on every citizen of the Union (Case C‑406/04 De Cuyper, paragraph 39).

The Court did consider whether the restriction, deriving from the residence requirement, was justified. Such a restriction can be justified, the Court held, only:
- if it is based on objective considerations of public interest independent of the nationality of the persons concerned
- and is proportionate to the legitimate objective of the national provisions (De Cuyper, paragraph 40).

As to the first condition (the existence of objective considerations of public interest) it is apparent the limitation in the Dutch legislation, by means of the condition of residence, of the number of persons likely to be eligible for the benefits introduced by that legislation results from the Netherlands legislature’s wish to limit the obligation of solidarity with civilian war victims to those who had links with the population of the Netherlands during and after the war. The condition of residence is therefore an expression of the extent to which such victims are connected to Netherlands society. The Court conceded that this aim of solidarity may constitute an objective consideration of public interest.

But that left the second condition, the one relating to proportionality. The Court had a problem with that one. The Court held that a condition of residence such as that in issue in the main proceedings cannot be characterised as an appropriate means by which to attain the objective sought. It found that a criterion requiring residence cannot be considered a satisfactory indicator of the degree of connection of applicants to the member State granting the benefit when it is liable, as is the case with the criterion in issue in the main proceedings, to lead to different results for persons resident abroad whose degree of integration into the society of the member State granting the benefit is in all respects comparable. The setting of a residence criterion such as that used in the main proceedings, based solely on the date on which the application for the benefit is submitted, is not a satisfactory indicator of the degree of attachment of the applicant to the society which is thereby demonstrating its solidarity with him. It follows that this condition of residence fails to comply with the principle of proportionality.

Consequently, the Court held the Dutch residence requirement was contrary to Article 18(1) EC.

Free movement of workers and Accession : The second phase 2006-2009

The Commission has issued a statement summarizing the transitional measures taken or to be taken by the 15 member States for the free movement of the workers under the accession treaty of 2003 for the period covering 2006-2009.

After the last enlargement on May 1st 2004 member States have had the possibility to introduce transitional arrangements concerning the access to their labour markets by workers from eight New Member States. Workers from Malta and Cyprus did not fall under that exemption.

The first phase of these transitional arrangements ended on May 1st, 2006.

Paragraph 2 of point 3 of the country-specific annexes to the 2003 Act of Accession requires all EU-15 member States to notify the Commission 'no later than at the end of the two year period following the date of accession' (April 30th, 2006) whether they will continue applying national measures or measures resulting from bilateral agreements, or whether they will apply Community law on access to their labour markets. The annexes also state that in the absence of such notification by a particular Member State, Community law on free movement of workers shall apply in that Member State from 1 May 2006 onwards.

It appears from the Commission's statement that Spain, Finland, Greece and Portugal will lift the existing restrictions. France will lift some of its restrictions gradually. Ireland, Sweden and the United Kingdom don't have restrictions anyway and don't intend to introduce any new ones.

Free movement of persons and residence : Directive 2004/38

Member States had until April 30th 2006 to implement Directive 2004/38/EC of the European Parliament and of the Council of April 29th 2004 on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States.

To mark the occasion, the Commission has issued two press releases. The first, brief one contains a very succinct summary of the Directive. The second, fuller one gives more detail and a few practical examples of the Directive should work.

But why two, different press releases ? They are not particularly well written : How can a "right" have "more transparency" ? At least they don't contradict each other.

What the press releases seem to omit to mention is that most member States appear not to have implemented the Directive.

Border control code published

A new regulation - Regulation (EC) No 562/2006 of the European Parliament and of the Council of March 15th 2006 establishing a Community Code on the rules governing the movement of persons across borders (Schengen Borders Code) - has been published.

The new regulation does not really introduce major changes but updates and systematizes the existing rules on (external) border controls. Border checks on movement of persons between member States remain prohibited in principle. It builds on the Schengen Agreement of June 14th, 1985. For a previous post on that, look here.

Neither Ireland nor the United Kingdom are bound by this new regulation.

Free movement of workers, foreigners and spouses : Case C-10/05

The Court of Justice's recent little judgment in Case C-10/05 Cynthia Mattern and Hajrudin Cikotic clears up a point about the rights of spouses and free movement of workers.

Ms. Mattern is a national of Luxembourg but working in Belgium. Her husband, Mr. Cikotic is a national of a non-member State and he applied for a work permit in Luxembourg. The Luxembourg authorities refused him the permit and Mr. Cikotic challenged that refusal alleging that he had the right to such a permit as he was married to a Luxemburger. The matter was then referred to the Court of Justice to ascertain whether he had such a right in Luxembourg when his wife was in fact working in Belgium.

The Court of Justice held that Mr. Cikotic had no right under EC law obtain a work permit in Luxembourg when his wife was working in Belgium.

It found in particular that Article 11 of Regulation No 1612/68 of the Council of October 15th 1968 on freedom of movement for workers within the Community, as amended by Council Regulation No 2434/92 of July 27th, 1992, does not confer on a national of a non member country the right to take up an activity as an employed person in a member State other than the one in which his spouse, a Community national, pursues or has pursued an activity as an employed person in exercise of her right to free movement.

Deportation, free movement of persons and Case C-408/03

Odd place Belgium. On the one hand it is prickly about extraditing persons charged with terrorism. On the other, it has an automatic system for deporting foreigners who reach the age of 65 because, well, they are 65. Unless they are wealthy in their own right, in which case they can stay.

The Court of Justice held in Case C-408/03 Commission v. Belgium that such a system was contrary to EC law.

The Court held that the right to reside in a member State is conferred directly on every citizen of the Union by Article 18 EC and by the measures adopted to give it effect (see Case C-413/99 Baumbast). The host member State can check whether the foreign citizen has sufficient resources to remain there without being a burden on the state but must - to comply with Council Directive 90/364/EEC of June 28th, 1990 on the right of residence - take account of the income of a partner who also resides in the host state even if that partner has no legal obligation to support the foreign citizen in question.

Foreign nationals, public policy and free movement: Case C-503/03

In its judgment in Case C-503/03 Commission v. Spain, the Court of Justice held that Spain had breached EC law by refusing entry into Spain to two Algerian men who were married to Spanish women on the sole ground that Germany had issued an "alert" under the Schengen Convention of June 19th, 1990 implementing the Schengen Agreement of June 14th 1985 between the Governments of the States of the Benelux Economic Union, the Federal Republic of Germany and the French Republic on the gradual abolition of checks at their common borders (known as "CISA"). CISA lays down cooperation measures designed to ensure, as compensation for the abolition of internal borders, the protection of all the territories of the Contracting Parties. Spain acceded to it in 1991.

The Schengen system was integrated into EC law by the Protocol integrating the Schengen acquis into the framework of the European Union annexed to the Amsterdam Treaty of 1997.

Under the CISA, a Contracting State can issue an "alert" about a person it deems should be refused entry. When such an alert is issued, the other Contracting States are obliged to refuse entry to the person who is the subject of the alert. The assessment of whether circumstances exist which justify the issuance of an alert for an alien falls within the exclusive competence of the State which issued that alert, which is responsible for the data it entered into the SIS and is the only State authorised to add to, correct or delete that data. The point was whether automatic refusal of entry was compatible with EC law when the alert concerned the spouse of a national of a member State.

So, in this case, the Court clarifies the relationship between the Schengen system, the CISA and EC law. The Court held that the Schengen Protocol confirms that the provisions of CISA are applicable only if and in so far as they are compatible with European Union and EC law. Closer cooperation in the Schengen field must be conducted within the legal and institutional framework of the European Union and with respect for the Treaties. It follows that the compliance of an administrative practice with the provisions of the CISA may justify the conduct of the competent national authorities only in so far as the application of the relevant provisions is compatible with the Community rules governing freedom of movement for persons.

And the Court held that Spain did not comply with EC law by automatically refusing entry to the spouses of Spanish nationals.

It noted that Council Directive 64/221/EEC of February 25th, 1964 on the co-ordination of special measures concerning the movement and residence of foreign nationals which are justified on grounds of public policy, public security or public health provides a certain degree of protection to persons seeking to benefit from free movement. The Court has held that a person may only be refused entry to a member State in accordance with Directive 64/221/EEC if he represents a genuine and serious threat to the requirements of public policy of the host state. Such a strict interpretation serves to protect the right of a spouse to family life protected by Article 8 of the European Convention on Human Rights (see Case C-109/01 Akrich).

Consequently, the Court found that the concept of public policy within the meaning of the Directive 64/221/EEC does not correspond to that in the CISA. As a result an alien who is the spouse of a member State national risks being deprived of the protection provided for by the 1964 directive where an alert has been issued for the purposes of refusing him entry.

That means that a Contracting State may issue an alert for such a person only after establishing that his presence constitutes a genuine, present and sufficiently serious threat affecting one of the fundamental interests of society within the meaning of Directive 64/221/EEC. A member State which consults the alert must be able to establish, before refusing entry into the Schengen Area to the person concerned, that his presence in that area constitutes such a threat.