# C_2006281EN.01002301.xml

| 18.11.2006 | EN | Official Journal of the European Union | C 281/23 |
| --- | --- | --- | --- |

18.11.2006

EN

Official Journal of the European Union

C 281/23

---

Action brought on 7 September 2006 — Commission of the European Communities v Italian Republic

(Case C-365/06)

(2006/C 281/37)

Language of the case: Italian

Parties

Applicant: Commission of the European Communities (represented by: E. Traversa and E. Montaguti, Agents)

Applicant:

Defendant: Italian Republic

Defendant:

Form of order sought

| — | Declare that:






  — | by restricting the activity of preparing and printing pay slips to employment consultants, or persons with equivalent status, registered with the relevant professional associations; |
| --- | --- | --- |

—

Declare that:

—

by restricting the activity of preparing and printing pay slips to employment consultants, or persons with equivalent status, registered with the relevant professional associations;

| — | by laying down specific requirements concerning the composition and establishment of data-processing centres; |
| --- | --- |

—

by laying down specific requirements concerning the composition and establishment of data-processing centres;

| — | by making registration with such professional associations subject to a requirement of residence in Italy, |
| --- | --- |

—

by making registration with such professional associations subject to a requirement of residence in Italy,

the Italian Republic has failed to fulfil its obligations under Articles 43 EC and 49 EC;

and that:

| — | by prohibiting any person from pursuing any activity as employment consultant unless that person is registered with a professional association in Italy, |
| --- | --- |

—

by prohibiting any person from pursuing any activity as employment consultant unless that person is registered with a professional association in Italy,

the Italian Republic has failed to fulfil its obligations under Article 49 EC;

| — | Order the Italian Republic to pay the costs. |
| --- | --- |

—

Order the Italian Republic to pay the costs.

Pleas in law and main arguments

| — | Restricting the activity of preparing and printing pay slips to employment consultants and other professional groups set out exhaustively in the legislation constitutes a restriction on freedom of establishment and freedom to provide services guaranteed by Articles 43 EC and 49 EC. The activities provided by data-processing centres essentially consist of simply carrying out instructions received from clients. That entails entering data provided by the client onto particular computer software which has been programmed with information provided by that client in accordance with the legislation in force. The work of data processing centres preparing pay slips does not therefore entail any responsibility for calculating an individual employee's net salary on the basis of the relevant legislation, which requires analysis and in-depth knowledge of that legislation. Restricting the activity of preparing and printing pay slips to employment consultants cannot therefore be justified in the light of the need to protect workers' rights since such tasks are essentially executory and do not require specific professional qualifications. |
| --- | --- |

—

Restricting the activity of preparing and printing pay slips to employment consultants and other professional groups set out exhaustively in the legislation constitutes a restriction on freedom of establishment and freedom to provide services guaranteed by Articles 43 EC and 49 EC. The activities provided by data-processing centres essentially consist of simply carrying out instructions received from clients. That entails entering data provided by the client onto particular computer software which has been programmed with information provided by that client in accordance with the legislation in force. The work of data processing centres preparing pay slips does not therefore entail any responsibility for calculating an individual employee's net salary on the basis of the relevant legislation, which requires analysis and in-depth knowledge of that legislation. Restricting the activity of preparing and printing pay slips to employment consultants cannot therefore be justified in the light of the need to protect workers' rights since such tasks are essentially executory and do not require specific professional qualifications.

| — | In order to be able to provide the services of preparing and printing pay slips to small undertakings, data-processing centres must be ‘formed and composed exclusively of persons registered with the relevant professional associations’. ‘That requirement ... precludes the board members of foreign parent companies from being founder members or from sitting on the board of management of an Italian subsidiary unless they arrange to be registered with the relevant professional associations. ... [This] is a covert form of discrimination which, through the application of a criterion other than nationality, achieves the same result as discrimination which is overtly based on nationality.’ (Opinion of Advocate General Mischo in Case C-79/01 Payroll Data Services [2002] ECR I-8923). |
| --- | --- |

—

In order to be able to provide the services of preparing and printing pay slips to small undertakings, data-processing centres must be ‘formed and composed exclusively of persons registered with the relevant professional associations’. ‘That requirement ... precludes the board members of foreign parent companies from being founder members or from sitting on the board of management of an Italian subsidiary unless they arrange to be registered with the relevant professional associations. ... [This] is a covert form of discrimination which, through the application of a criterion other than nationality, achieves the same result as discrimination which is overtly based on nationality.’ (Opinion of Advocate General Mischo in Case C-79/01 Payroll Data Services [2002] ECR I-8923).

That requirement ... precludes the board members of foreign parent companies from being founder members or from sitting on the board of management of an Italian subsidiary unless they arrange to be registered with the relevant professional associations. ... [This] is a covert form of discrimination which, through the application of a criterion other than nationality, achieves the same result as discrimination which is overtly based on nationality

Payroll Data Services

| — | Italian legislation provides that any person applying for registration with such an association must submit a certificate of residence with the application. If the purpose of the residence requirement is to enable checks to be carried out and, where necessary, action to be taken against providers of services acting in breach of the rules, such a requirement appears wholly disproportionate. Indeed, regardless of the place of residence, it is perfectly possible to carry out checks and, if necessary, impose penalties on any data-processing centre established in any Member State. The residence requirement is not therefore justified by the need to protect workers relied on by the Italian authorities. |
| --- | --- |

—

Italian legislation provides that any person applying for registration with such an association must submit a certificate of residence with the application. If the purpose of the residence requirement is to enable checks to be carried out and, where necessary, action to be taken against providers of services acting in breach of the rules, such a requirement appears wholly disproportionate. Indeed, regardless of the place of residence, it is perfectly possible to carry out checks and, if necessary, impose penalties on any data-processing centre established in any Member State. The residence requirement is not therefore justified by the need to protect workers relied on by the Italian authorities.

| — | The Italian legislation that is the subject of this action provides, finally, that even data processing centres established in other Member States must, in order to be able to offer their services, have within their internal structure employment consultants who are registered with an Italian professional association. The requirement for employment consultants to be registered with a professional association appears to go beyond what is necessary for the protection of workers and makes the provision of services subject to an actual authorisation procedure on the part of the competent authorities without any distinction being made between permanent and temporary provision of services. To ignore such a distinction would amount to depriving ‘of all practical effectiveness the provisions of the Treaty whose object is, precisely, to guarantee the freedom to provide services’, (Case C-58/98 Corsten [2000] ECR I-7919). |
| --- | --- |

—

The Italian legislation that is the subject of this action provides, finally, that even data processing centres established in other Member States must, in order to be able to offer their services, have within their internal structure employment consultants who are registered with an Italian professional association. The requirement for employment consultants to be registered with a professional association appears to go beyond what is necessary for the protection of workers and makes the provision of services subject to an actual authorisation procedure on the part of the competent authorities without any distinction being made between permanent and temporary provision of services. To ignore such a distinction would amount to depriving ‘of all practical effectiveness the provisions of the Treaty whose object is, precisely, to guarantee the freedom to provide services’, (Case C-58/98 Corsten [2000] ECR I-7919).

of all practical effectiveness the provisions of the Treaty whose object is, precisely, to guarantee the freedom to provide services

Corsten

---