Essent

In this case, the CJEU established that national legislation making the provision of transnational services subject to obtaining a work permit may constitute a restriction on the freedom to provide services within the meaning of Article 56 TFEU.

The case concerns workers who are nationals of a non-member state (Turkey), employed by an undertaking established in a member state (Germany) and posted to another member state (the Netherlands) where they carried out work for an undertaking other than the one to which they were posted. A labour inspection revealed that the workers did not have a work permit for the member state to which they had been posted, a violation for which the company that had commissioned the work received a fine as per Dutch legislation. The company appealed the decision.

The question that the CJEU addressed is whether Articles 56 and 57 TFEU should be interpreted as precluding legislation such as the one at hand which makes the posting to a member state of non-member state workers employed in another member state subject to a requirement for a work permit. [Paras 36 - 43].

While the CJEU acknowledged that such legislation may be justified by an overriding requirement in the public interest and that such a requirement could include the need to avoid disturbances of the national labour market as argued by the Netherlands, this did not apply to the present case as posted workers will return to their country of origin or residence upon terminating their work and as such will not insert themselves into the member state of posting’s job market. [Paras 48, 51].

The CJEU ultimately held that there are less restrictive ways of achieving the objectives of the legislation [paras 58-59] and thus ruled that Articles 56 and 57 TFEU must be interpreted as precluding such legislation. [Para. 60].