Commission of the European Communities v Kingdom of Sweden.
Date: 2007-01-18
12. It must be borne in mind, first of all, that, according to settled case-law, although direct taxation is a competence of the Member States, they must none the less exercise it consistently with Community law (see Case C-334/02 Commission v France [2004] ECR I-2229, paragraph 21, and Case C-446/03 Marks & Spencer [2005] ECR I-10837, paragraph 29).
15. Article 18 EC, which sets out in general terms the right of every citizen of the Union to move and reside freely within the territory of the Member States, finds specific expression in Article 43 EC with regard to freedom of establishment and in Article 39 EC with regard to freedom of movement for workers (Case C-345/05 Commission v Portugal  [2006] ECR I-0000, paragraph 13).
17. The provisions of the Treaty on freedom of movement for 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 (see Case C-464/02 Commission v Denmark  [2005] ECR I-7929, paragraph 34 and the case-law cited).
18. Rules which preclude or deter a national of a Member State from leaving his country of origin in order 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 (see Case C-209/01 Schilling and Fleck-Schilling  [2003] ECR I-13389, paragraph 25, and Commission v Denmark , paragraph 35).
19. It is clear from the case-law of the Court that, even if, according to their wording, the rules on freedom of movement for workers are intended, in particular, to ensure that foreign nationals and companies are treated in the host Member State in the same way as nationals of that State, they also preclude the State of origin from obstructing the freedom of one of its nationals to accept and pursue employment in another Member State (Case C-385/00 De Groot  [2002] ECR I-11819, paragraph 79).
20. The same also applies to the rules concerning freedom of establishment. According to the case-law, even if, according to their wording, those rules are intended to ensure that foreign nationals and companies are treated in the host Member State in the same way as nationals of that State, they also prohibit the Member State of origin from hindering the establishment in another Member State of one of its nationals or of a company incorporated under its legislation (Case C-9/02 De Lasteyrie du Saillant  [2004] ECR I-2409, paragraph 42, and Case C-471/04 Keller Holding  [2006] ECR I-2107, paragraph 30).
25. According to well-established case-law, however, national measures which are liable to hinder the exercise of fundamental freedoms guaranteed by the Treaty or make it less attractive may nevertheless be allowed if they pursue a legitimate objective in the public interest, are appropriate to ensuring the attainment of that objective, and do not go beyond what is necessary to attain the objective pursued (see, De Lasteyrie du Saillant , paragraph 49, and Case C-470/04 N [2006] ECR I-0000, paragraph 40).
26. Moreover, whilst the Court has recognised that the need to maintain the coherence of a tax system can justify a restriction on the exercise of the fundamental freedoms guaranteed by the Treaty, for an argument based on such a justification to succeed, a direct link must be established between the tax advantage concerned and the offsetting of that advantage by a particular tax levy (see, to that effect, Keller Holding , paragraph 40 and the case-law cited).
28. According to the case-law, whether a Member State has failed to fulfil its obligations must be determined by referen ce to the situation prevailing in the 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, inter alia, Case C-388/02 Commission v Ireland  [2003] ECR I-12173, paragraph 6).
32. It is to be noted, in the present case, that the rules prohibiting restrictions on the freedom of movement and the freedom of establishment laid down in Articles 28 and 31 of the EEA Agreement are essentially identical to those established by Articles 39 EC and 43 EC.