The Social Market Economy and Restriction of Free Movement Rights: plus c'est la même chose?

• Published date: 01 January 2019
• Author: Niamh Nic Shuibhne
• Date: 01 January 2019
• DOI: http://doi.org/10.1111/jcms.12816

The Social Market Economy and Restriction of Free Movement

Rights: plus c’est la même chose?

NIAMH NIC SHUIBHNE

University of Edinburgh, Edinburgh

Abstract

Case law restricting free movement rights is criticized for privileging the internal market over so-

cial rights, achieved through reductive ‘binary’reasoning that focuses too narrowly on the ‘free

movement versus social rights’dimension of the conf‌lict. The problem is typically discussed for

the economic freedoms but is evident elsewhere in free movement law too. This point is demon-

strated through the example of EU citizenship and social assistance, which establishes that

protecting national public f‌inances justif‌ies free movement restrictions when citizens are not seen

as market participants. For better integration of economic, social and constitutional objectives, ju-

dicial assessments have progressed in some respects beyond the binary conf‌lict method, evidenc-

ing the beginnings of the more complex accommodation of multiple dimensions that a system of

multilevel constitutionalism requires. However, these advances have not yet produced signif‌icantly

different outcomes in practice. The legacy of binary conf‌lict reasoning proves stubbornly resilient

to change.

Keywords: social market economy; free movement rights

Introduction

In Brüstle, Advocate General Bot observed that ‘the Union is not only a market to be reg-

ulated, but also has values to be expressed’.

1

The array of values on which the EU is

founded and to which it subscribes has been clarif‌ied and expanded in each instance of

Treaty revision. Moreover, in def‌ining the EU internal market as ‘an area without internal

frontiers in which the free movement of goods, persons, services and capital is ensured’,

Article 26(2) of the Treaty on the Functioning of the European Union (TFEU) also re-

quires that this task must be done ‘in accordance with the provisions of the Treaties’.

Article 7 TFEU articulates the overarching process idea in its statement that ‘[t]he

Union shall ensure consistency between its policies and activities, taking all of its objec-

tives into account and in accordance with the principle of conferral of powers’. More spe-

cif‌ically for present purposes, codif‌ication of the Union’s ambition to ‘work for …a

highly competitive social market economy’(Article 3(3) of the Treaty on European Union

(TEU)), added by the Lisbon Treaty, exemplif‌ies an integrated conception of market and

non-market goals for EU law and policy-making. This idea of the social market economy

ref‌lecting but also arguably requiring the integration of market objectives and social ob-

jectives –rather than conceiving them as ‘contradictory pairs’(Polomarkakis, 2017, p.

424) –informs the analysis that follows.

1

AG Bot in Case C-34/10 Brüstle (EU:C:2011:138), para. 46 of the Opinion.

JCMS 2019 Volume 57. Number 1. pp. 111–126 DOI: 10.1111/jcms.12816

© 2018 University Association for Contemporary European Studies and John Wiley & Sons Ltd

The controversial judgments in Viking Line and Laval provide the archetypal example

of the ‘contradictory pairs’approach in the sense of concerns about social dumping and

the posting of workers being subsumed by freedom of establishment and the free provi-

sion of services protected by EU internal market law (Syrpis and Novitz, 2008).

2

On

one view, the Treaty itself sets up a reductively binary –market versus social –framing

of these disputes by requiring that restrictions of free movement –even where such re-

strictions aim to protect fundamental social rights –must be defended, that is, shown to

be justif‌iable in principle and proportionate (Barnard, 2008). The economic freedom

protected by the Treaty acquires not just legal but also normative priority as a result.

The conventional premises of the economic constitution then prevail -- economic free-

doms as def‌ining principles in the aim of integrating distinct national markets into an in-

ternal market; supported by an autonomous constitutional framework characterized by the

principles of direct effect and primacy. Moreover, within that template, the Court of Jus-

tice necessarily retains command over a wide interpretative space.

It should also be remembered that the EU Treaties do not tend to provide guidance

about how different policies and objectives committed to should be reconciled with each

other, or whether and how they might be prioritized, when they end up in conf‌lict in a

given situation. Taking all Union objectives into account is one thing in the abstract;

but how can it be given practical effect when concrete disagreements must be resolved?

The fact that relevant Treaty amendments have never adjusted the restriction/defence

structure of provisions conferring free movement rights adds to the confusion. The greater

emphasis on competition enforcement and on the social dimension of the market that the

ambition of a highly competitive social market economy aims to advance does not, in

other words, change the EU’s basic constitutional mechanisms in and of itself. Without

more deliberate resetting –on the Court’s own initiative as well as in the Treaties –it

is diff‌icult to see how ‘the EU system[’s] accumulated internal asymmetries between mar-

ket integration at supranational level and social protection at national level, which gener-

ate frictions and are a source of disenchantment and hostility towards market opening’

(Monti, 2010, p. 68) can be better addressed.

Normative balancing is not, however, the only relevant conf‌lict vector in these cases.

At the time of writing, a revised framework for the posting of workers (European Com-

mission, 2016) is working its way through the EU’s legislative procedures. This process

highlights another signif‌icant dimension of the market/social conf‌lict, questions about re-

spective Union/member state(s) competences. The Union has limited capacity to act in the

f‌ield of social protection

3

and the member states have chosen diverse social models. In-

deed, the Commission’s plans for reform of EU legislation on posted workers were ini-

tially halted by national parliaments triggering the Lisbon Treaty’s subsidiarity

mechanism (European Commission, 2016b). EU citizenship case law on free movement

restrictions provides another example of the competence dimension of market/social con-

f‌licts, in the sense of an inherently Union status necessarily challenging national regula-

tory discretion. Such challenges are particularly sensitive when the Union citizenship

claim impacts on national public f‌inances, leading the Court to articulate more forcefully

2

Case C-438/05 Viking Line, EU:C:2007:772 and Case C-341/05 Laval, EU:C:2007:80.

3

See Articles 148–161 TFEU; and note, in particular, the limitations in Articles 151 and 153. See further, European Com-

mission, 2017.

Niamh Nic Shuibhne112

© 2018 University Association for Contemporary European Studies and John Wiley & Sons Ltd