European Commission v Kingdom of Belgium.

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• Writing for the Court: Arabadjiev
• ECLI: ECLI:EU:C:2010:513
• Date: 14 September 2010
• Docket Number: C-47/08
• Procedure Type: Recours en constatation de manquement - non fondé

OPINION OF ADVOCATE GENERAL

CRUZ VILLALÓN

delivered on 14 September 2010 ¹(1)

Case C‑47/08

European Commission

v

Kingdom of Belgium

Case C‑50/08

European Commission

v

French Republic

Case C‑51/08

European Commission

v

Grand Duchy of Luxembourg

Case C‑53/08

European Commission

v

Republic of Austria

Case C‑54/08

European Commission

v

Federal Republic of Germany

Case C‑61/08

European Commission

v

Hellenic Republic

(Actions for failure to fulfil obligations – Freedom of establishment – Direct discrimination on grounds of nationality – Profession of notary – Nationality condition – Article 43 EC and the first paragraph of Article 45 EC – Activities connected with the exercise of official authority – Scope of the freedom of establishment – Principle of proportionality – European citizenship –Directive 2005/36/EC)

Table of contents

I – Introduction

II – Legal framework

A – Community law

1. Primary law

2. Secondary law

B – National law

1. The profession of notary

a) Belgian law

b) French law

c) Luxembourg law

d) Austrian law

e) German law

f) Greek law

g) Summary

2. The national legislation specifically forming the subject of the actions: the nationality clauses

a) Belgian law

b) French law

c) Luxembourg law

d) Austrian law

e) German law

f) Greek law

III – Forms of order sought by the parties

IV – Admissibility

V – Substance

A – The first plea of infringement

1. Three general introductory observations

a) The provision which the Commission accuses the Member States of infringing: Article 43 EC and the first paragraph of Article 45 EC

b) The difficulty of interpreting the meaning of the first paragraph of Article 45 EC

c) Application of the principle of proportionality

2. Activity connected with the exercise of official authority

a) The case-law of the Court

b) The need for a fuller definition of the meaning of official authority

3. Whether the activities of notaries, in particular authentication, form part of the negative scope of the freedom of establishment

a) Authentication as the central activity of notaries in the defendant Member States

b) Attribution of the activity of authentication to the exercise of official authority

4. The nationality clause in the light of the principle of proportionality

a) Notarial status

b) Discrimination on grounds of nationality in the light of Article 43 EC and the first paragraph of Article 45 EC

c) Assessment of proportionality

5. Conclusion in respect of the first plea of infringement

B – The second plea of infringement

VI – Costs

VII – Conclusion

I – Introduction

1. In these actions for failure to fulfil obligations, the European Commission seeks a declaration from the Court of Justice that the Kingdom of Belgium, the French Republic, the Grand Duchy of Luxembourg, the Republic of Austria, the Federal Republic of Germany and the Hellenic Republic have failed to fulfil their obligations under Article 43 EC and the first paragraph of Article 45 EC by limiting access to the profession of notary exclusively to nationals of their own country (‘the nationality clause’). The European Commission also seeks a declaration that those Member States, with the exception of the French Republic, have failed to fulfil the obligations arising from Directive 2005/36/EC on the recognition of professional qualifications (2) by not applying that directive to the profession of notary. (3)

2. Although the Commission’s case is confined to challenging discrimination on grounds of nationality, the issue underlying these proceedings is significantly more complex. The purpose of these actions is after all to seek from the Court of Justice a declaration that the civil-law function of notary as it is performed in a significant number of Member States (4) falls within the scope of the freedom of establishment because it is not connected with the ‘exercise of official authority’.

3. In general terms, this case brings before the Court what is possibly the most sensitive issue concerning the interpretation of the combined provisions of Article 43 EC and the first paragraph of Article 45 EC which it has ever faced. As will be seen, the cases concerning the combination of those two provisions which the Court has dealt with up until now have concerned professionals with nebulous or only very occasional connections with official authority, which certainly cannot be said to be true prima facie of the cases at hand.

4. For those reasons, the six actions grouped together for the purposes of this Opinion provide the Court with the opportunity to examine in more detail than ever before the scope of a provision as complex as that resulting from the combination of Article 43 EC and the first paragraph of Article 45 EC. In so doing, and unlike in previous cases, the Court must seek in these proceedings to strike the right balance between the objectives pursued by the fundamental freedoms of the European Union, respect for the competences of the Member States and the status of European citizenship. When balancing those values against each other, the Court will find that the aforementioned articles require a special act of interpretation which will be decisively shaped by the principle of proportionality.

5. The scale of the issue raised here and the possibility of introducing a proportionality test in the context of Article 43 EC and the first paragraph of Article 45 EC clearly show how important this case is not only to the profession of notary itself but also and more broadly to European Union law.

II – Legal framework

A – Community law

1. Primary law

6. The legislation on which the Commission relies in support of its application is the combined provisions of Article 43 EC and the first paragraph of Article 45 EC (now Articles 49 and 51 TFEU), which, at the time when the alleged infringement occurred, conferred freedom of establishment on natural and legal persons in the following terms:

‘Article 43

Within the framework of the provisions set out below, restrictions on the freedom of establishment of nationals of a Member State in the territory of another Member State shall be prohibited. Such prohibition shall also apply to restrictions on the setting-up of agencies, branches or subsidiaries by nationals of any Member State established in the territory of any Member State.

…

Article 45

The provisions of this Chapter shall not apply, so far as any given Member State is concerned, to activities which in that State are connected, even occasionally, with the exercise of official authority.

The Council may, acting by a qualified majority on a proposal from the Commission, rule that the provisions of this Chapter shall not apply to certain activities.’ (5)

2. Secondary law

7. Directive 89/48 provided for a transposition period which, under Article 12 of the Directive, expired on 4 January 1991.

8. Article 2 of the Directive provided:

‘This Directive shall apply to any national of a Member State wishing to pursue a regulated profession in a host Member State in a self-employed capacity or as an employed person.

This Directive shall not apply to professions which are the subject of a separate Directive establishing arrangements for the mutual recognition of diplomas by Member States.’

9. It should be noted that the profession of notary has not been regulated by any instrument referred to in the second paragraph of the above article.

10. Directive 89/48 was repealed and codified by Directive 2005/36. The new wording retains the essential content of Directive 89/48 but recital 41, which is a new departure from its predecessor, provides, in terms that are obviously not irrelevant, as follows:

‘This Directive is without prejudice to the application of Articles 39(4) and 45 of the Treaty concerning notably notaries.’

B – National law

1. The profession of notary

11. Both the Commission and the Member States have supplied abundant factual and legal information describing in detail the profession of notary in each country. However, taking into account the extent of the information provided, the fact that this Opinion covers a number of cases and the need to bring clarity of argument to my analysis of the substance of the proceedings, I shall subsequently provide a separate summary both of the provisions relied on and of the functions assigned to the profession of notary in each Member State, the most notable of which is the authentication of legal transactions.

a) Belgian law

12. In Belgium, the profession of notary is regulated by the Law of 25 Ventose of Year XI, as well as by various provisions contained, inter alia, in the Belgian Judicial Code.

13. Under Belgian law, the task of the notary is principally to draw up authentic instruments that have two main characteristics: perfect probative value and enforceability. (6)

14. The notary performs the function of authentication on the instruction of a party and examines the legality of the instrument being authenticated. The notary’s intervention may be compulsory or optional, depending on the instrument that is to be authenticated, and involves verifying that all the conditions that may be required by law for the execution of the instrument have been met and that the parties have legal capacity and capacity to act. In the course of carrying out these tasks, the notary informs each party of his rights and obligations and gives completely impartial advice. (7) The notary also determines and collects directly the fees due for the registration and creation of mortgages.

15. All instruments drawn up by a notary have perfect probative value equivalent to that conferred by instruments drawn up by a public official and challengeable only before a court of law. The notary’s assessment is open to review but only by means of an extraordinary review procedure. (8)

16. Furthermore, an authenticated instrument is enforceable throughout Belgian territory. (9...