Judgment — ECLI:EU:C:2002:89
Date: 2002-02-07
Language of the case: Italian
Court formation: Sixth Chamber
Based on: Treaty establishing the European Economic Community (1957)
Subject matter: Free movement of capital;Freedom to provide services
Concepts: General
Procedure: Action for failure to fulfil obligations - successful
Origin: Italy

Summary of the Judgment 
1. Actions for failure to fulfil obligations — Examination of the merits by the Court — 
Situation to be taken into consideration — Situation on expiry of the period laid down 
by the reasoned opinion 
(Art. 226 EC) 
2. freedom to provide services — Restrictions — Requirement that undertakings pro­
viding temporary labour which are established in other Member States maintain their 
registered office or a branch office on a Member State's own territory — Not 
permissible — Justification based on grounds of public interest — Social protection 
of workers — Not a justification 
(Art. 49 EC) 
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SUMMARY — CASE C-279/00 
3. Freedom to provide services — Restrictions justified in the public interest — Whether 
permissible — Conditions 
(Art. 49 EC) 
4. Freedom to provide services — Free movement of capital — Restrictions — Require­
ment that undertakings providing temporary labour which are established in other 
Member States lodge a guarantee with a credit institution having its registered office or 
a branch office on a Member State's own territory — Not permissible 
(Arts 49 EC and 56 EC) 
1. In an action under Article 226 EC, the 
question whether a Member State has 
failed to fulfil its obligations must be 
determined by reference to the situ­
ation prevailing in that Member State 
at the end of the period laid down in 
the reasoned opinion, and the Court 
cannot take account of any subsequent 
changes. 
(see para. 10) 
2. A Member State which requires in its 
legislation that undertakings engaged 
in the provision of temporary labour 
which are established in other Member 
States maintain their registered office 
or a branch office on its territory, fails 
to fulfil its obligations under Article 49 
EC. 
In order for the requirement that 
undertakings providing temporary 
labour which wish to supply man­
power to customers established in a 
Member State must have their regis­
tered office or a branch office on its 
territory, which is the very negation of 
the fundamental freedom to provide 
services, to be accepted, it must be 
shown that it constitutes a condition 
indispensable for attaining the objec­
tive pursued. 
In that regard, notwithstanding that 
the protection of workers is among the 
overriding reasons of public interest 
capable of justifying a restriction on 
the freedom to provide services, the 
fact remains, however, that the require­
ment to have the registered office or a 
branch office on its territory, goes 
beyond what is necessary to achieve 
the objective of protection of workers. 
(see paras 17-20, operative part) 
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COMMISSION v ITALY 
3. The freedom to provide services, as one 
of the fundamental principles of the 
Treaty, may be restricted only by rules 
justified by overriding requirements 
relating to the public interest and 
applicable to all persons and undertak­
ings operating in the territory of the 
State where the service is provided, in 
so far as that interest is not safeguarded 
by the rules to which the provider of 
such a service is subject in the Member 
State where it is established. 
(see para. 33) 
4. A Member State which requires in its 
legislation that undertakings engaged 
in the provision of temporary labour 
which are established in other Member 
States lodge a guarantee with a credit 
institution having its registered office 
or a branch office on its territory fails 
to fulfil its obligations under 
Articles 49 EC and 56 EC. 
(see paras 34, 41, operative part) 
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