CELEX: 62001CJ0232
Freedom of movement for workers
Vehicle leasing
Obligation to register vehicle in worker's Member State of residence

By order of 11 June 2001, received at the Court on 18 June 2001, the Politierechtbank te Mechelen (Local Criminal Court, Mechelen)
(Belgium) referred to the Court for a preliminary ruling under Article 234 EC a question on the interpretation of Articles
10 EC and 39 EC.
Factual and legal background
Mr Van Lent is a Belgian national residing in Putte (Belgium).
During a traffic check in Willebroek (Belgium) on Sunday 22 August 1999, it was found that Mr Van Lent was driving a motor
vehicle with a Luxembourg registration plate.
The vehicle was registered in the name of Axus Luxembourg SA, a leasing company established in Luxembourg, apparently without
a place of business in Belgium. Mr Van Lent stated that he was working as a civil engineer for EDS SA (
EDS), established in Bascharage (Luxembourg), who had provided him with the leased vehicle and for which he did not have to pay
any rental charges. EDS also had a place of business in Antwerp (Belgium).
The Crown Prosecutor served a summons on Mr Van Lent for having taken on the public highway a motor vehicle which had not
been registered in Belgium in the name of its owner, in breach of Article 3(1) of the Royal Decree of 31 December 1953 governing
the registration of motor vehicles and trailers, (
Belgische Staatsblad
of 9 January 1954, p. 87) as amended by the Royal Decree of 27 December 1993 (
Belgische Staatsblad
of 18 January 1994, p. 954) (
the Royal Decree of 31 December 1953).
Under that provision: Motor vehicles and trailers shall be permitted to travel on the public highway only if, on application by and in the name
of their owner, they have first been entered in the register of motor vehicles and trailers referred to in Article 2 ...
In accordance with Article 4 of the Royal Decree of 31 December 1953, an application for registration of a vehicle must be
sent to the Road Traffic Office on a form showing, where the applicant is a legal person,
inter alia
, its value added tax (
VAT) number or, if it has no VAT number, its national register number and the full address of its registered office in Belgium.
The Royal Decree of 31 December 1953 was repealed by the Royal Decree of 20 July 2001 on the registration of vehicles (
Belgische Staatsblad
of 8 August 2001, p. 27022,
the Royal Decree of 20 July 2001). Under Article 10(1) of the Royal Decree of 20 July the user of a vehicle is now authorised to re-register it in Belgium
should the owner of the vehicle be unable to do so. That new rule is not, however, applicable to this case.
During the hearing on 18 September 2000 before the Politierechtbank te Mechelen Mr Van Lent stated that he worked exclusively
for EDS in Luxembourg, but that he attended meetings in Antwerp. He stated, further, that he also used the vehicle for private
purposes to go home at the weekend.
Before that court, Mr Van Lent submitted that Article 3(1) of the Royal Decree of 31 December 1953 infringed
Community law and, more particularly, the principle of freedom of movement for workers guaranteed by the Treaty of Rome.
The question referred for a preliminary ruling
Taking the view that the dispute did indeed raise a question concerning the interpretation of Community law, the Politierechtbank
te Mechelen decided to stay the proceedings and referred the following question to the Court for a preliminary ruling: Do Community rules, in particular Article 39 EC (formerly Article 48 of the EC Treaty) and Article 10 EC (formerly Article 5
of the EC Treaty), preclude a Member State from requiring registration of a vehicle belonging (1) to a leasing company established
in a neighbouring Member State, which is leased by an employer and used by an employee (2) who is resident in the first-mentioned
Member State, at a distance, more specifically, of some 200 km from his place of employment, (3) in a situation where the
employee in question resides in the first-mentioned Member State during the week and uses the vehicle in order to perform
his contract of employment and also during his free time, including weekends and holiday periods?
Examination of the question referred for a preliminary ruling
By its question, the national court asks, essentially, whether Article 39 EC precludes national rules of a Member State which
prohibit a worker who is domiciled in that Member State from using on its territory a vehicle registered in another neighbouring
Member State, belonging to a leasing company established in that second Member State and made available to the worker by his
employer who is also established in the second Member State.
As a preliminary point it must be recalled that although, in the absence of complete harmonisation in the field, the Member
States may prescribe the conditions for the registration of vehicles travelling on their territory, the measures adopted cannot
be exempt from the application of Articles 10 EC and 39 EC (see, by way of analogy, Case C-121/00
Hahn
[2002] ECR I-9193, paragraph 34).
Any Community national who, irrespective of his place of residence and his nationality, has exercised the right to freedom
of movement for workers and who has been employed in a Member State other than that of residence falls within the scope of
Article 39 EC (Case C-419/92
Scholz
[1994] ECR I-505, paragraph 9, and Case C-385/00
De Groot
[2002] ECR I-11819 paragraph 76).
Moreover, it is settled case-law that all of the EC Treaty provisions relating to the freedom of movement of persons are intended
to facilitate the pursuit by Community nationals of occupational activities of all kinds throughout the Community, and preclude
measures which might place Community nationals at a disadvantage when they wish to pursue an economic activity in the territory
of another Member State (Case C-370/90
Singh
[1992] ECR I-4265, paragraph 16; Case C-302/98
Sehrer
[2000] ECR I-4585, paragraph 32; and
De Groot
, cited above, paragraph 77).
In that regard, it must be pointed out that provisions which preclude or deter a national of a Member State from leaving his
country of origin to exercise his right to freedom of movement therefore constitute an obstacle to that freedom even if they
apply without regard to the nationality of the workers concerned (
de Groot
, paragraph 78).
In the present case it appears, first, that Article 3 of the Royal Decree of 31 December 1953 prohibits a vehicle registered
in another Member State from being driven in Belgium in circumstances such as those in this case.
Second, it does indeed appear to follow from Articles 3 and 4 of the Royal Decree of 31 December 1953 that the worker, Mr
Van Lent, could not register the vehicle in Belgium because he is not the owner and that the owner, the leasing company, could
not register it either because it is not established in Belgium and does not have a Belgian VAT number as is required for
registration of the vehicle.
As the Advocate General states at point 23 of his Opinion, it is effectively impossible for a worker in Mr Van Lent's position,
domiciled in Belgium, who uses the vehicle for work and to go home to Belgium at the weekend, to benefit from the provision
of a vehicle belonging to a person established in another Member State.
In the same way, such rules could discourage an employer based in one Member State from engaging a worker residing in another
Member State because of the higher costs and administrative difficulties involved.
Such a measure, which has the effect of preventing a worker from benefiting from certain advantages, in particular, the provision
of a vehicle, may deter him from leaving his country of origin in order to exercise his right to free movement.
In those circumstances it must be considered whether the restriction arising from the national law may be justified.
The Member States which intervened in the present case argue that the obligation to register vehicles under the national rules
is necessary to ensure road safety and to combat erosion of the tax base.
In that regard, it is sufficient to observe that, since the vehicle cannot be registered in Belgium, the objectives of the
obligation to register cannot be achieved. It follows that the restriction on freedom of movement for workers cannot be justified.
That observation does not, however mean that in a case such as this, the possibility of registering the vehicle introduced
by the Royal Decree of 20 July 2001 has the effect of justifying, in respect of Article 39 EC for an employee or Article 43
EC for an employer or leasing company, the obstacles which remain as a result of the Belgian legislation.
In those circumstances, the answer to the question referred to the Court must be that Article 39 EC precludes national rules
of a Member State such as those in the present case, which prohibit a worker who is domiciled in that Member State from using
on its territory a vehicle registered in another neighbouring Member State, belonging to a leasing company established in
that second Member State, and made available to the worker by his employer who is also established in the second Member State.
Costs
The costs incurred by the Belgian, Danish, Finnish and United Kingdom Governments and the Commission, which have submitted
observations to the Court, are not recoverable. Since these proceedings are, for the parties to the main proceedings, a step
in the action pending before the national court, the decision on costs is a matter for that court.
On those grounds,
THE COURT (Fifth Chamber),
in answer to the question referred to it by the Politierechtbank te Mechelen by order of 11 June 2001, hereby rules:
Wathelet
Edward
Jann
von Bahr
Rosas
Delivered in open court in Luxembourg on 2 October 2003.
R. Grass
M. Wathelet
Registrar
President of the Fifth Chamber
–
Language of the case: Dutch.