CELEX: 62005CJ0134
Language: en
Date: 2007-07-18 00:00:00
Title: Judgment of the Court (First Chamber) of 18 July 2007. # Commission of the European Communities v Italian Republic. # Failure of a Member State to fulfil obligations - Freedom to provide services - Right of establishment - Extrajudicial debt recovery. # Case C-134/05.

Case C-134/05
      Commission of the European Communities
      v
      Italian Republic
      (Failure of a Member State to fulfil obligations – Freedom to provide services – Right of establishment – Extrajudicial debt recovery)
      Opinion of Advocate General Poiares Maduro delivered on 14 December 2006 
      Judgment of the Court (First Chamber), 18 July 2007 
      Summary of the Judgment
      Freedom of movement for persons – Freedom of establishment – Freedom to provide services – Extrajudicial debt recovery
      (Arts 43 EC and 49 EC)
      By requiring every undertaking pursuing the activity of extrajudicial debt recovery: 
      – to apply, even though the undertaking holds a licence issued by the competent authority of a province, for a new licence
         for each other province in which it wishes to carry on its activities, unless it confers authority on an authorised agent
         in that other province, a Member State fails to fulfil its obligations under Articles 43 EC and 49 EC;
      
      – to have premises in the territory covered by the licence and to display in those premises a list of the services which may
         be provided for clients, a Member State fails to fulfil its obligations under Article 49 EC;
      
      – to have premises in each province in which it intends to carry on its activities, a Member State fails to fulfil its obligations
         under Article 43 EC.
      
      (see paras 47, 64, 66, 87, operative part)
JUDGMENT OF THE COURT (First Chamber)
      18 July 2007 (*)
      
      (Failure of a Member State to fulfil obligations – Freedom to provide services – Right of establishment – Extrajudicial debt recovery)
      In Case C-134/05,
      ACTION under Article 226 EC for failure to fulfil obligations, brought on 22 March 2005,
      Commission of the European Communities, represented by E. Traversa, acting as Agent, with an address for service in Luxembourg,
      
      applicant,
      v
      Italian Republic, represented by I.M. Braguglia, acting as Agent, and P. Gentili, avvocato dello Stato, with an address for service in Luxembourg,
      
      defendant,
      THE COURT (First Chamber),
      composed of P. Jann, President of the Chamber, K. Lenaerts, E. Juhász, K. Schiemann and E. Levits (Rapporteur), Judges,
      Advocate General: M. Poiares Maduro,
      Registrar: L. Hewlett, Principal Administrator,
      having regard to the written procedure and further to the hearing on 5 October 2006,
      after hearing the Opinion of the Advocate General at the sitting on 14 December 2006,
      gives the following
      Judgment
      1       By its application, the Commission of the European Communities requests the Court to declare that, by making the pursuit of
         the activity of extrajudicial debt recovery subject to a series of conditions, the Italian Republic has failed to fulfil its
         obligations under Articles 43 EC and 49 EC.
      
       Legal context
      2       The Consolidated Law on public security (Testo unico delle leggi di pubblica sicurezza), approved by Royal Decree No 773 of
         18 June 1931 (GURI No 146 of 26 June 1931) (‘the Consolidated Law’) provides as follows. 
      
      3       Under Article 115 of the Consolidated Law:
      ‘It is not permitted to open or manage a pawnbrokers or other business agency, whatever the purpose or duration, even in the
         form of sales agencies, exhibition agencies, showrooms, commercial exhibition agencies or any other agencies, without a licence
         issued by the Questore (the local police authority).
      
      A licence is also necessary in order to pursue the profession of broker or agent.
      The agencies covered by the present article include agencies for the collection of data to be disseminated by bulletins or
         other similar means.
      
      The licence shall be valid exclusively for the premises which are specified therein.
      Representation by an agent shall be permitted’.
      4       In accordance with Article 8 of the Consolidated Law:
      ‘Police licences are personal: they cannot under any circumstances be transferred or give rise to agency relationships, except
         where expressly provided for by law.
      
      Where representation by an agent is permitted under a police licence, the agent must possess the qualifications necessary
         to obtain the licence and be approved by the police authority which issued it.’
      
      5       Article 9 of the Consolidated Law provides:
      ‘In addition to the conditions laid down by law, any person who has obtained a police licence shall comply with instructions
         that the public law-enforcement authority considers necessary to issue to him in the public interest.’
      
      6       Article 11 of the Consolidated Law provides:
      ‘Without prejudice to the specific conditions provided by law in each case, police licences shall be refused to:
      1.      any person who has been sentenced to a term of imprisonment of more than three years for a crime committed intentionally and
         who has not been discharged;
      
      2.      any person who has received a caution or detention order, who has been declared a habitual or inveterate offender, or as someone
         having criminal tendencies.
      
      Police licences may be refused to persons who have been sentenced for crimes against the State or public order, for violent
         crimes against the person, theft, robbery, extortion, kidnapping for the purpose of theft or extortion, for violence towards
         or resistance to authority, or to any person who is unable to prove that he is of good conduct.
      
      Licences shall be revoked where the conditions to which they are subject are no longer satisfied, either wholly or in part,
         with respect to the person to whom the licence was issued, and may be revoked where circumstances arise or come to light which
         would have required or permitted the licence to be refused.’
      
      7       Article 16 of the Consolidated Law provides:
      ‘Public security officials and agents are entitled to gain access at any time to premises to be used for activities requiring
         a licence issued by the police and to ensure compliance with the obligations imposed by law, regulations or the authorities.’
      
      8       Article 120 of the Consolidated Law is worded as follows:
      ‘The traders and public agencies referred to in the preceding articles shall be required to keep a daily business record in
         a manner to be determined by regulation and to display permanently and visibly on the premises the table of services provided
         and the scale of charges applicable to those services.
      
      Those traders cannot supply services other than those listed in that table or apply higher prices than those set out in the
         scale of charges …’
      
      9       The Ministry of the Interior Circular 559/C 22103.12015 of 2 July 1996 (‘the circular’), sent to all Questori in the Italian
         State, supplements and interprets a number of provisions in the Consolidated Law.
      
      10     That circular states, inter alia, that, in order to avoid wide variations in the scales of charges being applied within the
         same province, it is necessary to set objective and uniform parameters.
      
      11     As regards the compatibility of the pursuit of the activity of extrajudicial debt recovery with other activities subject to
         different rules, the circular states that debt recovery agencies ‘are deemed not to be entitled to provide the financial services
         governed by Legislative Decree No 385/93 [relating to the Consolidated Law on banking and credit services] (Testo unico delle
         leggi in materia bancaria e creditizia) of 1 September 1993 (Ordinary Supplement to GURI No 230 of 30 September 1993) (‘the
         Law on banking and credit services’), which are reserved exclusively for financial intermediaries expressly entered in the
         appropriate register of the Ministry of the Treasury’.
      
       The pre-litigation procedure
      12     Since the Commission took the view that a number of provisions of the Consolidated Law, as amplified and supplemented by the
         circular, were incompatible with Articles 43 EC and 49 EC, it sent a letter of formal notice to the Italian Republic on 21 March
         2002.
      
      13     Although they denied any infringement of the abovementioned articles of the EC Treaty, the Italian authorities replied that
         they had set up a working group to undertake a detailed examination of the rules concerned for the purpose of revising them.
      
      14     After requesting the Italian authorities to communicate to it the working group’s findings, the Commission received a letter,
         in May 2004, announcing the preparation of a draft law designed to amend the relevant legislation.
      
      15     However, as neither the text nor the timetable for the adoption of that draft legislation was communicated to it, the Commission
         sent a reasoned opinion to the Italian Republic on 7 July 2004, calling on that Member State to comply with the reasoned opinion
         within two months of receipt. Taking the view that the situation continued to remain unsatisfactory, the Commission brought
         the present action.
      
       The action
      16     In support of its action, the Commission puts forward eight heads of complaint concerning the conditions and obligations imposed
         by the legislation in force in Italy for the purpose of pursuing the activity of extrajudicial debt recovery in that Member
         State.
      
      17     Those heads of complaint are based on:
      –       the incompatibility with Article 49 EC of the condition that a licence issued by a Questore be obtained;
      –       the incompatibility with Articles 43 EC and 49 EC of the territorial limitation of the licence;
      –       the incompatibility with Articles 43 EC and 49 EC of the obligation to have premises in the territory covered by the licence;
      –       the incompatibility with Articles 43 EC and 49 EC of the requirement that authority must be conferred on an authorised agent
         in order to pursue the activity of extrajudicial debt recovery in a province for which the operator does not hold a licence;
      
      –       the incompatibility with Article 49 EC of the obligation to display on the premises a list of the services which may be provided
         to clients;
      
      –       the incompatibility with Articles 43 EC and 49 EC of the power granted to the Questore to impose additional requirements designed
         to ensure compliance with public safety in the general interest;
      
      –       the incompatibility with Articles 43 EC and 49 EC of the limit on the freedom to fix scales of charges, and
      –       the incompatibility with Articles 43 EC and 49 EC of the prohibition of the concurrent pursuit of the activities covered by
         the Law on banking and credit services.
      
       The first head of complaint: incompatibility with Article 49 EC of the condition that a licence issued by a Questore be obtained
            
       Arguments of the parties
      18     The Commission claims that Italian law, inasmuch as it makes pursuit of the activity of extrajudicial debt recovery subject
         to obtaining a licence issued by a Questore, constitutes a restriction on the freedom to provide services. That restriction,
         it argues, is not compatible with Article 49 EC on the ground that it applies to operators established in another Member State
         without any consideration being given as to whether those operators comply with the requirements laid down by the law of their
         Member State of origin on the protection of the public interest.
      
      19     In that connection, the Italian Republic submits, first of all, that the activity of extrajudicial debt recovery is one of
         overriding public interest. That justifies the fact that Article 115 of the Consolidated Law requires both Italian nationals
         and nationals of other Member States to have a licence in order to be able to pursue that activity. Such a licence is issued
         by a Questore.
      
      20     The Italian Government further submits that the national law applies in like manner to Italian nationals and nationals of
         other Member States, and is in no way based on conditions such as residence, which might lead to indirect discrimination of
         nationals of other Member States as compared with Italian nationals. Furthermore, neither Article 115 of the Consolidated
         Law nor the circular provides, explicitly or implicitly, that the legal situation of the person concerned in his Member State
         of origin may not to taken into account in the course of the procedure for granting a licence.
      
      21     In practice, the situation is as follows: any person wishing to pursue activities of extrajudicial debt recovery, public auctioneering
         or public relations, or to operate a matrimonial agency, must submit an application to a Questore for a licence pursuant to
         Article 115 of the Consolidated Law. That request is made by lodging an application form available on the internet, an example
         of which was produced before the Court at the hearing on 5 October 2006, by which the person concerned declares in substance
         that he does not fall within one of the excluded categories laid down by Article 11 of the Consolidated Law.
      
      22     In accordance with Article 2 of Law No 241/90 establishing new standards in administrative matters and relating to the right
         of access to administrative documents (Nuove norme in materia di procedimento amministrativo e di diritto di accesso ai documenti
         amministrativi) of 7 August 1990 (GURI No 192 of 18 August 1990, p. 7), that declaration must be examined within 30 days from
         the date on which the application for a licence was lodged. Where there is nothing to give rise to doubts on the part of the
         Questore as to the accuracy of that declaration, the licence is issued. Otherwise, any investigations deemed necessary are
         carried out. For that purpose, the Questore contacts, if necessary, the authorities in the applicant’s Member State of origin.
         The information or documents supplied in that event by the latter are taken into account without being re-examined or challenged
         in any manner whatsoever.
      
       Findings of the Court
      23     It must be stated, first of all, that it is clear from settled case-law that national legislation which makes the provision
         of services on national territory by an undertaking established in another Member State subject to the issue of an administrative
         authorisation constitutes a restriction on the freedom to provide services within the terms of Article 49 EC (see, inter alia,
         Case C-189/03 Commission v Netherlands [2004] ECR I-9289, paragraph 17, and Case C-168/04 Commission v Austria [2006] ECR I-9041, paragraph 40).
      
      24     It follows that a law such as that in issue in the main proceedings in the present case is in principle contrary to Article
         49 EC and, therefore, prohibited by that article unless it can be justified, in particular, by overriding grounds of public
         interest.
      
      25     In that connection, it should be recalled that the Court has ruled that, by excluding consideration of the obligations to
         which the trans-frontier service provider is already subject in the Member State in which it is established, a national law
         goes beyond what is necessary to attain the objectives sought, namely to ensure close supervision of those activities (Case
         C-171/02 Commission v Portugal [2004] ECR I-5645, paragraph 60, and Commission v Netherlands, paragraph 18).
      
      26     It must be observed that, at the hearing, the Italian Republic gave a detailed explanation of the practice followed for the
         issue of a licence under Article 115 of the Consolidated Law. That practice, described in paragraphs 21 and 22 of the present
         judgment, is in reality merely a requirement that the person concerned lodge, by way of an application form available on the
         internet, a simple declaration of ‘good conduct’ within the meaning of Article 11 of the Consolidated Law, the competent authority
         having a 30-day period within which to verify the content of that declaration.
      
      27     The existence of that practice as described was not challenged by the Commission at the hearing and there is nothing before
         the Court capable of casting doubt on the reality of that practice.
      
      28     Since the application form concerned is available on, inter alia, the internet, the system of granting licences for exercising
         the activity of extrajudicial debt recovery can be regarded as being given adequate publicity.
      
      29     The requirement of a declaration of ‘good conduct’ within the meaning of Article 11 of the Consolidated Law is much less onerous
         than the obligation to supply documents to the competent authority. In so far as it requires a supplier of services to declare
         that he is not in one of the situations mentioned in that article, without distinguishing between the situation of a person
         established in Italy and that of a person established in another Member State, it cannot be argued that the procedure fails
         to take account of compliance by the latter with the requirements laid down in the legislation of his State of origin.
      
      30     Therefore, it cannot be held that the Italian practice goes beyond what is necessary to attain the objective pursued, which
         is to ensure close supervision of extrajudicial debt recovery activities. Therefore, that practice is in accordance with the
         principle of proportionality.
      
      31     It follows that the condition that a licence must first be obtained in order to pursue the activity of extrajudicial debt
         recovery, as laid down by Italian law and implemented in practice, is justified by reasons relating to the public interest.
         
      
      32     That being so, the Commission’s first head of complaint is unfounded.
       The sixth head of complaint: incompatibility with Articles 43 EC and 49 EC of the possibility for a Questore to impose additional
            requirements designed to ensure compliance with public safety in the general interest
       Arguments of the parties
      33     According to the Commission, the fact that a Questore may, pursuant to Article 9 of the Consolidated Law, impose requirements
         in addition to those provided for by law, not known in advance by the operators concerned and intended to ensure compliance
         with public safety in the general interest infringes Articles 43 EC and 49 EC.
      
      34     With regard to those requirements, set out under the heading ‘Warnings’ in the application form mentioned in paragraph 21
         of this judgment, the Italian Republic notes that, since the administration's discretion is clearly limited by Article 11
         of the Consolidated Law, the directions laid down in Article 9 thereof are marginal and residual. Therefore, they are not
         such as to genuinely dissuade the persons concerned from operating in Italy. Furthermore, having regard to changing and unforeseeable
         circumstances, it is inevitable that the administration may find it necessary to carry out individual assessments on a case-by-case
         basis. Therefore, it would be excessive to require the legislation to set out exhaustively all the criteria to which the administration
         must adhere.
      
       Findings of the Court
      35     It is undoubtedly the case, as the Italian Republic submits, that the national law enforcement authority must have some discretion
         to assess situations on a case-by-case basis and that it might be required to issue instructions to police licence holders
         which cannot be determined in advance.
      
      36     As it is clear from the actual wording of Article 9 of the Consolidated Law, any person who has obtained a police licence
         must comply with the instructions issued to him which are deemed to be necessary by the law enforcement authority.
      
      37     Even though that provision does not set out in detail the requirements to which a person may be subject in carrying on the
         activity of extrajudicial debt recovery in Italy, the Commission has not established that the situation gives rise to legal
         uncertainty such as to affect access to the Italian market in extrajudicial debt recovery services.
      
      38     The Commission does not provide any example of the exercise of that discretion on the basis of which it could be argued that
         the establishment in Italy of undertakings wishing to carry on activities of extrajudicial debt recovery and the pursuit in
         that Member State of such activities by an undertaking established in another Member State might be impeded.
      
      39     The existence of an obstacle to the freedoms of movement and establishment cannot be inferred solely from the fact that a
         national authority has the power to supplement the legal framework regulating an economic activity at a particular time by
         subsequently making that activity subject to further conditions.
      
      40     It follows that the Commission’s sixth head of complaint is also unfounded.
       The third (in part) and fifth heads of complaints: incompatibility with Article 49 EC of the obligations to have premises
            in the territory covered by the licence and to display in those premises a list of the services which may be provided to clients
       Arguments of the parties
      41     The Commission points out that the obligation to have premises in the territory covered by the licence, arising from the fourth
         paragraph of Article 115 of the Consolidated Law, amount to a requirement that the operator establishes itself there, which
         is, according to well-established case-law of the Court, fundamentally incompatible with the principle of freedom to provide
         services guaranteed by Article 49 EC. It follows, the Commission argues, that the subsidiary obligation to display on the
         premises a list detailing the services which may be provided to clients, imposed by Article 120 of the Consolidated Law, is
         itself also contrary to Article 49 EC.
      
      42     The Italian Republic takes the view that the obligation to have premises in the territory covered by the licence is justified
         by the need to allow the law enforcement authority, in the public interest, to have access, for purposes of supervision, to
         documents relating to operations carried out in Italy. Therefore, the subsidiary obligation to display the list of services
         which may be provided, laid down with respect to all public agencies the activities of which require a licence, is also compatible
         with the freedom to provide services guaranteed by the Treaty. 
      
       Findings of the Court
      43     It must be observed, at the outset, that it is settled case-law that the requirement that a service provider must have its
         place of business in the Member State in which the service is provided directly negates the freedom to provide services in
         so far as it makes it impossible for service providers established in other Member States to provide services in that State
         (Case C-257/05 Commission v Austria, not published in the ECR, paragraph 21 and the case-law cited). The Italian Republic also does not deny that the obligation
         to have premises in the territory covered by the licence constitutes an obstacle, prohibited in principle, to the free provision
         of services guaranteed by Article 49 EC.
      
      44     That obstacle cannot be justified by the objective relied on by the Italian Republic.
      45     According to settled case-law of the Court, measures which restrict the freedom to provide services may be justified on overriding
         grounds of public interest only if they are necessary for the protection of the interests which they are intended to guarantee
         and only if those objectives cannot be attained by less restrictive measures (Commission v Austria, paragraph 23 and the case-law cited).
      
      46     The supervision of the activities of extrajudicial debt recovery agencies and of their documents relating to operations carried
         out in Italy is by no means dependent on the existence of premises which such undertakings are required to have in that Member
         State. Likewise, the services provided by those undertakings can be brought to the attention of clients by less onerous means
         than display at premises established, inter alia, for that purpose, such as publication in a local newspaper or appropriate
         publicity.
      
      47     Therefore, it must be held that, by requiring persons wishing to pursue activities of extrajudicial debt recovery to have
         premises in the territory covered by the licence and to display at those premises a list of the services which may be provided
         to clients, the Italian Republic has failed to fulfil its obligations under Article 49 EC.
      
       The second and fourth heads of complaints: incompatibility with Articles 43 EC and 49 EC of the territorial limitation of
            licences to pursue the activity of extrajudicial debt recovery and of the obligation to confer authority on an authorised
            representative in order to pursue that activity in a province in which the operator does not have a licence; and the third
            head of complaint, in so far as it is based on the incompatibility with Article 43 EC of the obligation to have premises in
            each province
       Arguments of the parties
      48     The Commission takes the view that the fact that the licence issued by a Quetore is valid only in the province covered by
         the latter’s authority constitutes a restriction on both the freedom of establishment and the freedom to provide services.
         As Italian territory is divided into 103 provinces, the number of licences required in order to pursue the activity of extrajudicial
         debt recovery throughout that territory constitutes an almost insurmountable obstacle for an economic operator from another
         Member State.
      
      49     According to the Commission, that restriction, which has consequences in regard to both the representation and the premises
         which the operator must have in each province, is not justified by public-safety requirements, in particular more effective
         supervision of the activities concerned.
      
      50     The Commission submits that that supervision may be organised at national level, possibly by carrying out some supervision
         at local level, but without it being necessary to require operators to hold a licence for each province in which they carry
         on their activities. Furthermore, that supervision could be operated effectively through exchanges of information between
         the law enforcement authorities in the different provinces in which operators intend to carry on their activities.
      
      51     The Commission also disputes the ability of the Italian system to attain the objective pursued, since the number of administrative
         bodies involved may, having regard to all the licences necessary and the number of premises to supervise with respect to the
         same operator, prove to be counter-productive in terms of effective supervision.
      
      52     The Italian Republic takes issue with the Commission's view. In light of its specific nature, the activity concerned is linked
         to local economic conditions. It is therefore vital that the Questore, prior to granting a licence, should assess the situation
         within the territory under its authority. If licences were valid over a more extensive geographic area than the territory
         of the province for which they are requested, that assessment could not be carried out in another province, even though the
         situation there might be different.
      
      53     The Italian Republic adds that, since it is accepted that the activity concerned may be supervised by a law enforcement authority,
         a point not challenged by the Commission, it is not for the Commission or the Court to lay down the specific technical rules
         according to which such supervision should be carried out.
      
      54     As regards the number of bodies involved in such supervision, the Italian Republic fails to see how that information could
         affect the assessment of the suitability of a system of supervision to attain its objective.
      
      55     The Italian Republic concludes that the system of territorial licences is justified by overriding reasons of public interest
         and is proportionate with regard to the objective pursued, even if other systems may be envisaged.
      
       Findings of the Court
      56     According to the legislation at issue, an undertaking may pursue activities of extrajudicial debt recovery only in the province
         for which a licence has been granted to it, except where authority is conferred on an agent with a view to pursuing those
         activities in another province. Furthermore, an undertaking can obtain licences to pursue those activities in other provinces
         only if it has premises in each of them.
      
      57     Even though those rules apply in exactly the same way to operators established in one Italian province which wish to extend
         their activities to other provinces and to operators from other Member States which wish to pursue their activities in several
         Italian provinces, they nonetheless constitute, for any operator not established in Italy, a serious obstacle to the pursuit
         of its activities in that Member State and one which affects its access to the market.
      
      58     Inasmuch as those rules require an operator from another Member State wishing to pursue its activities in several Italian
         provinces not to confine itself to one single establishment in Italian territory, but on the contrary require it to have premises
         in each of those provinces unless authority is conferred on an authorised agent, they place that operator at a disadvantage
         as compared with Italian operators established in Italy which already have premises in at least one of those provinces and
         generally have better opportunities than foreign operators to establish contacts with authorised operators in other provinces
         in order to issue, where necessary, powers of agency (see, to that effect, Case C‑442/02 CaixaBank France [2004] ECR I‑8961, paragraphs 12 and 13).
      
      59     With regard to the grounds put forward by the Italian Republic in justification of that obstacle to the freedoms guaranteed
         by Articles 43 EC and 49 EC, it must be stated first of all that neither the territorial limitation of the licence nor the
         obligation to have premises in the province for which the licence has been granted can a priori be considered to be inappropriate for attaining the objective of effective supervision of the activities concerned which is
         assigned to them.
      
      60     However, as the Commission points out, those rules go beyond what is necessary to attain that objective in so far as it may
         be achieved by less restrictive means.
      
      61     As was stated in paragraph 26 of this judgment, the Italian system provides for the issue of territorial licences on the basis
         of a declaration of ‘good conduct’ within the meaning of Article 11 of the Consolidated Law. If that declaration has been
         verified by the competent authority in the province in which it was lodged and that authority has issued a licence to the
         person concerned, the submission of the same declaration to the authorities in other provinces would serve no purpose.
      
      62     A licence issued by the Questore in one province should be sufficient to enable extrajudicial debt recovery activities to
         be pursued throughout Italy, unless the declaration on the basis of which the licence was granted becomes inaccurate, a matter
         which the licence holder is obliged to declare.
      
      63     In so far as the Italian Republic contends that the recognition by the competent authorities in one province of a licence
         issued in another is hampered by the fact that the issue of such a licence also depends on the assessment of local economic
         conditions by the Questore in each province, suffice it to recall that, in accordance with established case-law, any system
         of prior authorisation must be based on objective criteria which are non-discriminatory and known in advance by the persons
         concerned (Case C-463/00 Commission v Spain [2003] ECR I‑4581, paragraph 69 and the case-law cited, and Case C-372/04 Watts [2006] ECR I‑4325, paragraph 116). Since such an assessment lacks objective criteria which are known in advance by the undertakings
         concerned, that argument cannot justify the non-recognition by the Questore in one province of a licence issued by the Questore
         in another.
      
      64     Therefore, it must be held that, by requiring an extrajudicial debt recovery undertaking which has a licence to pursue that
         activity issued by the Questore in one province to apply for a separate licence in each province in which it wishes to pursue
         its activities, unless authority is conferred on an authorised agent in that other province, the Italian Republic has failed
         to fulfil its obligations under Article 43 EC and Article 49 EC.
      
      65     With regard to the obligation imposed on extrajudicial debt recovery undertakings to have premises in each province in which
         they intend to pursue their activities, suffice it to recall, as stated in paragraph 46 of this judgment, that the supervision
         of the activities of those undertakings and their documents relating to activities carried out is by no means dependent on
         the existence of premises which those undertakings are required to have in that province.
      
      66     By requiring extrajudicial debt recovery undertakings to have premises in each province in which they intend to pursue their
         activities, the Italian Republic has therefore also failed to fulfil its obligations under Article 43 EC.
      
       The seventh head of complaint: incompatibility with Articles 43 EC and 49 EC of the limitation on the freedom to fix scales
            of charges 
       Arguments of the parties
      67     The Commission submits that the provisions of the circular addressed to Questori stating that it is necessary to set objective
         and uniform parameters in order to avoid widely divergent scales of charges in the same province lack transparency and predictability.
         Those provisions constitute, in the view of the Commission, an obstacle to the freedoms enshrined in Articles 43 EC and 49
         EC inasmuch as they are more onerous for foreign operators than for Italian operators.
      
      68     Furthermore, the Commission claims that those provisions do not address the objective of protecting public safety and recalls,
         in that regard, the Court’s case-law to the effect that the reasons which may be invoked by a Member State by way of justification
         must be accompanied by an analysis of the appropriateness and proportionality of the restrictive measure in question. The
         Italian Republic, it submits, has failed to forward any convincing arguments in that regard.
      
      69     The Italian Republic contends, on the contrary, that the operators concerned are not deprived of the freedom to fix scales
         of charges since the circular contains only a recommendation addressed to the Questori, requesting the latter to indicate
         to operators the lists of rates based on objective factors such as costs or the relationship between supply and demand for
         the service concerned. Those recommendations are intended to prevent the development of unbridled competition in regard to
         prices of services, which might potentially threaten public policy in this sector of activity.
      
       Findings of the Court
      70     According to settled case-law, Article 49 EC precludes the application of any national rules which have the effect of making
         the provision of services between Member States more difficult than the provision of services purely within a Member State
         (see Joined Cases C-544/03 and C-545/03 Mobistar and Belgacom Mobile [2005] ECR I‑7723, paragraph 30 and the case-law cited).
      
      71     Therefore, as regards compulsory minimum rates, the Court has already held that legislation containing an absolute prohibition
         of derogation, by agreement, from the minimum fees set by a scale for services which are, on the one hand, court services
         and, on the other, reserved to lawyers constitutes a restriction on the freedom to provide services laid down in Article 49
         EC (Joined Cases C-94/04 and C-202/04 Cipolla and Others [2006] ECR I-11421, paragraph 70). 
      
      72     A prohibition of that nature deprives economic operators established in another Member State of the opportunity to compete
         more effectively, by offering charges lower than those in the scale of charges imposed, with the economic operators traditionally
         established in the Member State concerned, which therefore have greater opportunities than economic operators established
         abroad to build up their clientele (see, to that effect, Cipolla and Others, paragraph 59, see also, by way of analogy, CaixaBank France, paragraph 13).
      
      73     Likewise, such a prohibition limits the choice of recipients of the services in question in the Member State concerned, inasmuch
         as they cannot have recourse to the services in the Member State of foreign operators which would offer their services at
         a lower rate than the minimum fees set by the scale (see, to that effect, Cipolla and Others, paragraph 60).
      
      74     However, it must be observed that in Cipolla and Others the prohibition categorised as an obstacle to Article 49 EC derived from legislation in force which specifically and unconditionally
         prohibited any derogation by agreement from a mandatory scale, whereas in the present case there is merely an indication contained
         in a circular addressed to the Questori and described as a ‘recommendation’ by the Italian Republic which simply requests
         a number of ‘objective and uniform parameters’ to be set.
      
      75     It must also be stated, as the Commission itself observes in its application, that the Italian authorities have not provided
         specific details as to the measures adopted on the basis of the recommendation in the circular, which dates from 1996. Thus,
         it is not even certain that price lists for extrajudicial debt recovery undertakings actually exist. 
      
      76     It follows that the Commission has not established that there is a restriction on the free provision of services guaranteed
         by Article 49 EC.
      
      77     The same holds true with regard to the Commission’s present complaint in so far as it relates to the incompatibility with
         Article 43 EC of the limitation on the freedom to fix scales of charges.
      
      78     In those circumstances, it must be held that the Commission’s seventh head of complaint is entirely unfounded.
       The eighth head of complaint: incompatibility with Articles 43 EC and 49 EC of the prohibition of the concurrent pursuit of
            activities covered by the Law on banking and credit services
       Arguments of the parties
      79     The Commission takes the view that the incompatibility of the pursuit of the activity of extrajudicial debt recovery with
         the pursuit of other activities provided for in the circular amounts, for banking and credit service providers from other
         Member States, to a prohibition, contrary to Articles 43 EC and 49 EC, of the pursuit in Italy of extrajudicial debt recovery.
      
      80     Even if the circular were interpreted differently by the Italian authorities, the contested provision would still infringe
         those articles by reason of its highly ambiguous wording. Those operators are not in a position to determine clearly and precisely
         whether they are authorised to pursue the activity of extrajudicial debt recovery in Italy. According to settled case-law
         of the Court, that is sufficient for a finding of an infringement of Community law.
      
      81     The Italian Republic rejects those assertions. The circular, it contends, merely states that the activity of extrajudicial
         debt recovery is not part of the activity of savings collection and credit management regulated by the Law on banking and
         credit services and that, as a result, authorisation to pursue the former activity does not also permit an operator to pursue
         the latter.
      
      82     That Member State contends that, even if it were to be found that in the circular the term ‘incompatibility’ is used in an
         inappropriate manner, there could be no reasonable doubt as to the fact that there is nothing to prevent a person authorised
         to pursue those two types of activity from pursuing them concurrently.
      
       Findings of the Court
      83     It must be held, first, that the circular deals with the powers of extrajudicial debt recovery agencies with respect to the
         financial transactions regulated by the Law on banking and credit services and not with the prohibition of banking and credit
         service providers pursuing extrajudicial debt recovery activities in Italy.
      
      84     Second, it must be observed, as the Italian Republic submits, that it is clear from the text of the circular, as cited in
         paragraph 11 of this judgment, that it merely confirms that authorisation of the activity of extrajudicial debt recovery does
         not automatically entail authorisation to engage in the activities covered by the Law on banking and credit services.
      
      85     In the absence of legal uncertainty in the circular as regards the exercise of the activity of extrajudicial debt recovery
         vis-à-vis the exercise of activities covered by the Law on banking and credit services, there is no obstacle to the freedom
         guaranteed by Article 49 EC with respect to foreign operators with regard to the pursuit of the activity of extrajudicial
         debt recovery in Italy.
      
      86     The Commission’s eighth head of complaint is therefore unfounded.
      87     Having regard to the foregoing, it must be held that, by requiring, within the context of the Consolidating Law, every undertaking
         pursuing the activity of extrajudicial debt recovery:
      
      –       to apply, even though the undertaking holds a licence issued by the Questore of a province, for a new licence for each other
         province in which it wishes to carry on its activities, unless it confers authority on an authorised agent in that other province,
         the Italian Republic has failed to fulfil its obligations under Articles 43 EC and 49 EC;
      
      –       to have premises in the territory covered by the licence and to display in those premises a list of the services which may
         be provided for clients, the Italian Republic has failed to fulfil its obligations under Article 49 EC;
      
      –       to have premises in each province in which it intends to carry on its activities, the Italian Republic has failed to fulfil
         its obligations under Article 43 EC.
      
      88     The remainder of the action must be dismissed.
       Costs
      89     Under Article 69(3) of the Rules of Procedure, the Court may order that the costs be shared or that the parties bear their
         own costs, if each party succeeds on some and fails on other heads. 
      
      90     In the present case, since the Commission and the Italian Republic have each been partly unsuccessful on a number of heads,
         each must be ordered to bear its own costs. 
      
      On those grounds, the Court (First Chamber) hereby:
      1.      Declares that, by requiring, within the context of the Consolidated Law on public security (Testo unico delle leggi di pubblica
            sicurezza), approved by Royal Decree No 773 of 18 June 1931, every undertaking pursuing the activity of extrajudicial debt
            recovery:
      –       to      apply, even though the undertaking holds a licence issued by the Questore of a province, for a new licence for each other
            province in which it wishes to carry on its activities, unless it confers authority on an authorised agent in that other province,
            the Italian Republic has failed to fulfil its obligations under Articles 43 EC and 49       EC;
      –       to      have premises in the territory covered by the licence and to display in those premises a list of the services which may be
            provided for clients, the Italian Republic has failed to fulfil its obligations under Article 49 EC;
      –       to have premises in each province in which it intends to carry on its activities, the Italian Republic has failed to fulfil
            its obligations under Article 43 EC;
      2.      Dismisses the action as to the remainder;
      3.      Orders the Commission of the European Communities and the Italian Republic to bear their own respective costs.
      [Signatures]
      * Language of the case: Italian.