Judgment — ECLI:EU:C:2002:40
Date: 2002-01-24
Language of the case: German
Court formation: Fifth Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Freedom to provide services
Concepts: General
Procedure: Reference for a preliminary ruling
Origin: Germany

summary of that law itself, which could give rise to the impression that, in this case, it concerned the protection of an economic sector against foreign competition, we can only examine the content of that law and the other relevant texts in order to determine whether, objectively viewed, they guarantee to posted workers, as the German Government asserts, a level of social protection identical in substance to that enjoyed by workers in the construction industry who are established in Germany. 46. I therefore take the same view as the German and Portuguese Governments and the Commission, that what determines whether a national law gives rise to an unjustified restriction is not the legislative intent, as expressed in an explanatory memorandum or otherwise, but the effects which the law actually produces, through its operative provisions, on the freedom to provide services. 47. With regard to those operative provisions, the referring court points out that [t]he AEntG requires forfeiture of the gain accruing to a German or non-German employer who fails to pay posted employees the minimum wage laid down in a collective wage agreement declared to be universally binding .... 48. However, as the Portuguese Government and the Commission observe, the mere fact that an undertaking established in one Member State is obliged to pay employees posted to another Member State in the course of a provision of services the minimum wage laid down (for construction workers) in a collective agreement which is universally binding in that Member State is not contrary to the provisions of Article 59 et seq. of the Treaty. 49. It has been held by the Court that Community law does not preclude Member States from extending their legislation, or collective labour agreements entered into by both sides of industry, relating to minimum wages, to any person who is employed, even temporarily, within their territory, regardless of the country in which the employer is established, and, moreover, that Community law does not prohibit Member States from enforcing those rules by appropriate means. (7) 50. That does not mean that there may not be circumstances in which the application of such rules would be neither necessary nor proportionate to the objective pursued, namely the protection of the workers concerned. (8) Hitherto, the Court has acknowledged the existence of such circumstances only in the case of an undertaking established in a frontier region, some of whose employees may, for the purposes of the provision of services by the undertaking, be required, on a part-time basis and for brief periods, to carry out a part of their work in the adjacent territory of a Member State other than that in which the undertaking is established. (9) 51. It must be noted, however, that the national court does not cite any such exceptional circumstances in its order for reference. It simply refers to the fact that Portugaia is subject to the obligation to pay the minimum wage. But that, by itself, is not contrary to Article 59 et seq. of the Treaty. 52. As mentioned above (paragraphs 26 and 27), Portugaia makes the further point that the way the minimum wage is made up places it at a disadvantage vis-à-vis German employers. It refers to supplements comprised in the minimum wage which are designed, inter alia, to compensate for loss of earnings in certain periods when German employers do not have to pay wages. Yet Portugaia is obliged by Portuguese law to continue to pay its workers during such periods. 53. In its reply to a written question from the Court, the German Government states that there is no discrimination against foreign construction firms posting employees to Germany as alleged by the defendant in the main proceedings. It submits that Portugaia misunderstands the legal nature of the construction supplement. With the evolution of the law of collective bargaining, the supplement has gradually lost its original function of compensating for specific forms of hardship and has today become, quite irrespective of its origins, a fixed component of the wage packet. 54. However, the fact is that the referring court made no reference to the composition of the minimum wage, which, according to Portugaia, gives rise to a breach of Article 59 et seq. of the Treaty. The same applies, moreover, to Portugaia's arguments based on the difference in limitation periods for claims on unpaid wages, on the fact that the wage level is not justified by comparison to wage levels in other industries and on the fact that the criminal sanctions do not apply to German employers. 55. Since the referring court has not asked the Court whether those matters are capable of constituting a breach of Article 59 et seq. of the Treaty and since it has not even mentioned those matters, it would not be appropriate for me to express a view on them. 56. For under Article 234 EC, only a court or tribunal of a Member State has the right to refer a question for a preliminary ruling. The parties have of course the right to make observations on the question asked but they do not have the right to submit to the Court what is in fact a new question in relation to the one asked by the referring court. The Court has expressed the rule in the following terms: in view of the division of jurisdiction laid down by Article [234 EC], it is for the national court alone to determine the subject-matter of the questions which it wishes to refer to the Court. The Court cannot therefore, at the request of a party to the main proceedings, examine questions which have not been referred to it by the national court. (10) If in the light of the progress of the case the national court considers that it is necessary to obtain further interpretation of Community law it is for that court to make a fresh reference to the Court. (11) 57. In any event, if a question concerning Community law arises in connection with the aforementioned supplements, which it is for the national court to assess, it may be that the answer to the question is already provided by the existing case-law of the Court. 58. Accordingly, it is for the national court first to determine if the supplements referred to by Portugaia form part of the minimum wage. (12) 59. Secondly, if the supplements do form part of the minimum wage and if it is furthermore established that Portugaia, unlike German employers, must therefore pay a second time what it has already been required to pay under Portuguese law, which would constitute a restriction on freedom to provide services, (13) it is for the national court to determine whether the workers enjoy in the Member State of origin, by virtue of the payments already made by Portugaia, protection that is substantially comparable to that provided for by the national rules governing the supplements. 60. As the Court has held, [i]t must be acknowledged that the public interest relating to the social protection of workers in the construction industry and the monitoring of compliance with the relevant rules may constitute an overriding requirement justifying the imposition on an employer established in another Member State who provides services in the host Member State of obligations capable of constituting restrictions on freedom to provide services. However, that is not the case where the workers employed by the employer in question are temporarily engaged in carrying out works in the host Member State and enjoy the same protection, or essentially similar protection, by virtue of the obligations to which the employer is already subject in the Member State in which he is established. (14) 61. I therefore propose that the answer to be given to the first question is that Article 59 et seq. of the Treaty is to be interpreted as meaning that a national measure extending to foreign service providers and their posted employees the minimum wage provisions imposed by collective agreements in the construction industry, declared universally binding, is justified by overriding requirements relating to the social protection of the employees, irrespective of the fact that the measure is also aimed at achieving other objectives. The second question 62. The referring court asks secondly whether there is an unjustified restriction on the freedom to provide services under the EC Treaty where a domestic employer can pay less than the minimum wage laid down in a collective agreement declared universally binding by concluding a collective agreement specific to one undertaking (and enjoying precedence) whereas this is - at least in fact - not possible for a non-German EC employer proposing to post workers to Germany. Submissions of the parties 63. Portugaia proposes that the Court answer that Articles 48, 59 and 60 of the EC Treaty must be interpreted as not having been complied with by the combined provisions of the first sentence of Paragraph 1(3) of the AEntG and the collective agreement on the minimum wage in the construction industry in Germany, because an employer established in Germany can offer poorer employment terms than under the collective agreement declared universally binding by entering into a more favourable collective agreement which replaces the collective agreement declared universally binding, whereas that is not an option for an employer established outside Germany posting employees to Germany. 64. On the other hand, the German Government submits that the second question referred is inadmissible because it is of a purely hypothetical nature and the answer to the question is plainly not relevant to the outcome of the main proceedings. According to the German Government, the referring court raises the abstract risk of discrimination merely as a hypothetical possibility. As far as it was aware, in the sectors in which foreign employers are required to abide by collective agreements in relation to the minimum wage and paid leave funds, there are no undertaking-specific collective agreements in force which stipulate more favourable employment terms from the perspective of the German employers concerned than those imposed by the AEntG. 65. The French and Netherlands Governments and the Commission submit that the option given to German undertakings to enter into a collective agreement setting a lower minimum wage than that payable to posted workers by an undertaking established in another Member State creates discrimination based on nationality contrary to Community law and constitutes an unjustifiable restriction on the rules governing freedom to provide services. 66. The Commission adds, however, that in the context of the AEntG it is extremely doubtful whether such a situation could arise. None the less, in the Commission's view, it is for the national court to determine if it is possible, in practice, for a domestic employer to circumvent the minimum wage provisions of a collective agreement declared universally binding while a service provider from another Member State would be unable to do so. 67. The Portuguese Government submitted no observations on the second question. Analysis 68. I must first respond to the German Government's argument that the question is plainly not relevant to the outcome of the main proceedings. 69. The Court has consistently held (15) that ... it is for the national courts alone, before which the proceedings are pending and which must assume responsibility for the judgment to be given, to determine, having regard to the particular features of each case, both the need for a preliminary ruling to enable them to give judgment and the relevance of the questions which they refer to the Court. A request for a preliminary ruling from a national court may be rejected only if it is quite obvious that the interpretation of Community law sought by that court bears no relation to the actual nature of the case or the subject-matter of the main action. 70. That is not the case here, however. 71. It is apparent from the order for reference that Portugaia challenges the requirements imposed on it by the AEntG in relation to payment of the minimum wage, claiming that those requirements are contrary to Article 59 et seq. of the Treaty. In that light, it cannot be the case that a question which concerns a possible difference in the means available to German employers and foreign employers to avoid those requirements bears no relation to the actual nature of the case or the subject-matter of the main action. 72. Likewise, it cannot be concluded that the second question is inadmissible on the ground that there is, as far as the German Government is aware, no undertaking-specific collective agreement in force which stipulates more favourable employment terms from the perspective of the German employer concerned than those imposed by the AEntG. 73. According to the case-law, the Court is bound to accept the national court's finding. (16) The relevant finding in this case is that a domestic employer can pay less than the minimum wage laid down in a collective agreement declared to be generally binding by concluding a collective agreement specific to one undertaking (and enjoying precedence) whereas this is - at least in fact - not possible for any non-German EC employer when he plans to post workers to the Federal Republic of Germany. 74. The answer to the question whether this situation is contrary to Article 59 et seq. of the Treaty must be in the affirmative, since any discrimination against employers from the State of origin vis-à-vis those of the host State is prohibited. 75. According to the third paragraph of Article 60 of the Treaty, the person providing a service may, in order to do so, temporarily pursue his activity in the State where the service is provided, under the same conditions (17) as are imposed by that State on its own nationals. 76. But an employer from the State of origin who, unlike a host State employer, does not have any means - at least in practice - of avoiding the obligation to pay the minimum wage to its posted workers cannot pursue its activity in the State where the service is provided under the same conditions as are imposed by that State on its own nationals. 77. The answer to be given to the second question is therefore that the third paragraph of Article 60 of the Treaty precludes a situation in which an employer established in another Member State cannot - at least in fact - pay less than the minimum wage laid down in a collective agreement declared universally binding by concluding a collective agreement specific to one undertaking (and enjoying precedence) whereas it is possible for a host State employer to do so. Conclusions 78. I suggest the following answers to the questions referred by the Amtsgericht Tauberbischofsheim: (1) Article 59 of the EC Treaty (now, after amendment, Article 49 EC) et seq. is to be interpreted as meaning that a national measure extending to foreign service providers and their posted employees the minimum wage provisions imposed by collective agreements in the construction industry, declared universally binding, is justified by overriding requirements relating to the social protection of the employees, irrespective of the fact that the measure is also aimed at achieving other objectives. (2) The third paragraph of Article 60 of the EC Treaty (now, after amendment, the third paragraph of Article 50 EC) precludes a situation in which an employer established in another Member State cannot - at least in fact - pay less than the minimum wage laid down in a collective agreement declared universally binding by concluding a collective agreement specific to one undertaking (and enjoying precedence) whereas it is possible for a host State employer to do so. 1: - Original language: French. 2: - OJ 1996 L 18, p. 1. 3: - See also the written explanations of the Portuguese Government according to which a deadline laid down in Paragraph 10 of the AEntG was deleted when it was amended in 1998 in order to enable the German State to comply with the obligation imposed by Community law to transpose Directive 96/71 into national law within the time-limit laid down for that purpose by Article 7 of the Directive. 4: - Case C-165/98 [2001] ECR I-2189, paragraph 17. 5: - Opinion of Advocate General Mischo delivered on 13 July 2000 (in Case C-49/98, which is pending before the Court, points 29 and 30). 6: - Points 41 and 42 of the Opinion. 7: - Case C-369/96 Arblade and Others [1999] ECR I-8453, paragraph 41. See also Joined Cases 62/81 and 63/81 Seco and Desquenne & Giral [1982] ECR 223, paragraph 14, and Case C-113/89 Rush Portuguesa [1990] ECR I-1417, paragraph 12. 8: - Mazzoleni, cited above, paragraph 30. 9: - Mazzoleni, cited above, paragraph 31. 10: - Case C-377/88 SAFA [1990] ECR I-1, paragraph 20. See also Case C-412/96 Kainuun Liikenne and Pohjolan Liikenne [1998] ECR I-5141, paragraphs 23 and 24. 11: - See Case 311/84 CBEM [1985] ECR 3261, paragraph 10, and Case 299/84 Neumann [1985] ECR 3663, paragraph 12. 12: - Arblade, cited above, paragraphs 43 to 47. 13: - Arblade, cited above, paragraph 50. 14: - Arblade, cited above, paragraph 51, emphasis added. 15: - See, inter alia, Case C-230/96 Cabour [1998] ECR I-2055, paragraph 21. 16: - Arblade, cited above, paragraph 49. 17: - Emphasis added.