Criminal proceedings against Jean-Claude Arblade and Arblade & Fils SARL (C-369/96) and Bernard Leloup, Serge Leloup and Sofrage SARL (C-376/96).
Date: 1999-11-23
3 The obligations concerning the drawing-up, keeping and retention of social and labour documents, minimum remuneration in the construction industry and the systems of `timbres-intempéries' (bad weather stamps) and `timbres-fidélité' (loyalty stamps), and the monitoring of compliance with those obligations, are imposed by the following legislation:
- the Law of 8 April 1965 introducing labour regulations (Moniteur belge of 5 May 1965),
- the Law of 16 November 1972 concerning the Labour Inspectorate (Moniteur belge of 8 December 1972),
- Royal Decree No 5 of 23 October 1978 concerning the keeping of social documents (Moniteur belge of 2 December 1978),
- the Royal Decree of 8 August 1980 concerning the keeping of social documents (Moniteur belge of 27 August 1980, as rectified in Moniteur belge of 10 and 16 June 1981),
- the Collective Labour Agreement of 28 April 1988, concluded under the aegis of the Construction Sector Joint Committee, concerning the award of `timbres-fidélité' and `timbres-intempéries' (`the CLA of 28 April 1988') and rendered compulsory by the Royal Decree of 15 June 1988 (Moniteur belge of 7 July 1988, p. 9897),
- the Royal Decree of 8 March 1990 concerning the keeping of individual records for workers (Moniteur belge of 27 March 1990), and
- the Collective Labour Agreement of 28 March 1991 concluded under the aegis of the Construction Sector Joint Committee, concerning working conditions (`the CLA of 28 March 1991') and rendered compulsory by the Royal Decree of 22 June 1992 (Moniteur belge of 14 March 1992, p. 17968).
29 Directive 96/71 was not in force at the time when the matters in the main proceedings took place.  However, Community law does not prevent the national court from taking account, in accordance with a principle of its criminal law, of the more favourable provisions of Directive 96/71 for the purposes of the application of national law, even though Community law imposes no obligation to that effect (see Case C-230/97 Awoyemi [1998] ECR I-6781, paragraph 38).
30 As regards the second question referred in each of the two cases, concerning the classification of the provisions at issue as public-order legislation under Belgian law, that term must be understood as applying to national provisions compliance with which has been deemed to be so crucial for the protection of the political, social or economic order in the Member State concerned as to require compliance therewith by all persons present on the national territory of that Member State and all legal relationships within that State.
31 The fact that national rules are categorised as public-order legislation does not mean that they are exempt from compliance with the provisions of the Treaty; if it did, the primacy and uniform application of Community law would be undermined.  The considerations underlying such national legislation can be taken into account by Community law only in terms of the exceptions to Community freedoms expressly provided for by the Treaty and, where appropriate, on the ground that they constitute overriding reasons relating to the public interest.
The questions referred
33 It is settled case-law that Article 59 of the Treaty requires not only the elimination of all discrimination on grounds of nationality against providers of services who are established in another Member State but also the abolition of any restriction, even if it applies without distinction to national providers of services and to those of other Member States, which is liable to prohibit, impede or render less advantageous the activities of a provider of services established in another Member State where he lawfully provides similar services (see Case C-76/90 Säger [1991] ECR I-4221, paragraph 12, Case C-43/93 Vander Elst v Office des Migrations Internationales [1994] ECR I-3803, paragraph 14, Case C-272/94 Guiot [1996] ECR I-1905, paragraph 10, Case C-3/95 Reisebüro Broede v Sandker [1996] ECR I-6511, paragraph 25, and Case C-222/95 Parodi v Banque H. Albert de Bary [1997] ECR I-3899, paragraph 18).
34 Even if there is no harmonisation in the field, 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 undertakings 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 he is established (see, in particular, Case 279/80 Webb [1981] ECR 3305, paragraph 17, Case C-180/89 Commission v Italy [1991] ECR I-709, paragraph 17, Case C-198/89 Commission v Greece [1991] ECR I-727, paragraph 18, Säger, cited above, paragraph 15, Vander Elst, cited above, paragraph 16, and Guiot, cited above, paragraph 11).
35 The application of national rules to providers of services established in other Member States must be appropriate for securing the attainment of the objective which they pursue and must not go beyond what is necessary in order to attain it (see, in particular, Säger, paragraph 15, Case C-19/92 Kraus v Land Baden-Württemberg [1993] ECR I-1663, paragraph 32, Case C-55/94 Gebhard v Consiglio dell'Ordine degli Avvocati e Procurati di Milano [1995] ECR I-4165, paragraph 37, and Guiot, cited above, paragraphs 11 and 13).
36 The overriding reasons relating to the public interest which have been acknowledged by the Court include the protection of workers (see Webb, cited above, paragraph 19, Joined Cases 62/81 and 63/81 Seco v EVI [1982] ECR 223, paragraph 14, and Case C-113/89 Rush Portuguesa [1990] ECR I-1417, paragraph 18), and in particular the social protection of workers in the construction industry (Guiot, paragraph 16).
37 By contrast, considerations of a purely administrative nature cannot justify derogation by a Member State from the rules of Community law, especially where the derogation in question amounts to preventing or restricting the exercise of one of the fundamental freedoms of Community law (see, in particular, Case C-18/95 Terhoeve [1999] ECR I-345, paragraph 45).
38 However, overriding reasons relating to the public interest which justify the substantive provisions of a set of rules may also justify the control measures needed to ensure compliance with them (see, to that effect, Rush Portuguesa, cited above, paragraph 18).
39 It is therefore necessary to consider, in turn, whether the requirements imposed by national rules such as those at issue in the main proceedings have a restrictive effect on freedom to provide services, and, if so, whether, in the sector under consideration, such restrictions on freedom to provide services are justified by overriding reasons relating to the public interest.  If they are, it is necessary, in addition, to establish whether that interest is already protected by the rules of the Member State in which the service provider is established and whether the same result can be achieved by less restrictive rules (see, in particular, Säger, paragraph 15, Kraus, cited above, paragraph 32, Gebhard, cited above, paragraph 37, Guiot, cited above, paragraph 13, and Reisebüro Broede, cited above, paragraph 28).
41 As regards the obligation on an employer providing services to pay his workers the minimum remuneration fixed by a collective labour agreement applying in the host Member State to the activities carried on, it must be recalled 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 (Seco, cited above, paragraph 14, Rush Portuguesa, paragraph 18, and Guiot, paragraph 12).
42 It follows that the provisions of a Member State's legislation or collective labour agreements which guarantee minimum wages may in principle be applied to employers providing services within the territory of that State, regardless of the country in which the employer is established.
43 However, in order for infringement of the provisions in question to justify the criminal prosecution of an employer established in another Member State, those provisions must be sufficiently precise and accessible that they do not render it impossible or excessively difficult in practice for such an employer to determine the obligations with which he is required to comply.  It is for the competent authority - in the present case, the Belgian Social Law Inspectorate -, when laying an information before the criminal courts, to state unequivocally the obligations with which the employer is accused of having failed to comply.
45 The Belgian and Austrian Governments consider that the advantages guaranteed to workers by the `timbres-intempéries' and `timbres-fidélité' schemes, as provided for by the CLA of 28 April 1988, constitute part of the minimum annual income of a construction worker within the meaning of the Belgian legislation.
48 As regards the obligation to pay employers' contributions to the Belgian `timbres-intempéries' and `timbres-fidélité' schemes, it is apparent from the judgment of the national court, and in particular from the wording of the first question referred in each of the two cases, that Arblade and Leloup are already subject, in the Member State in which they are established, to obligations which, while not identical, are at least comparable as regards their objective, and which relate to the same workers and the same periods of activity.
49 The Belgian Government submits that the referring court has not determined the existence of such obligations in the Member State of establishment.  However, the Court is bound to accept the national court's finding that the undertaking providing the services is already subject, in the Member State in which it is established, to obligations which, because of their objective, are comparable.
51 It 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 (see, to that effect, Guiot, paragraphs 16 and 17).
52 Moreover, an obligation requiring a provider of services to pay employers' contributions to the host Member State's fund cannot be justified where those contributions confer no social advantage on the workers in question (Seco, paragraph 15).
58 An obligation of the kind imposed by the Belgian legislation, requiring certain additional documents to be drawn up and kept in the host Member State, gives rise to additional expenses and administrative and economic burdens for undertakings established in another Member State, with the result that such undertakings are not on an equal footing, from the standpoint of competition, with employers established in the host Member State.
59 Consequently, the imposition of such an obligation constitutes a restriction on freedom to provide services within the meaning of Article 59 of the Treaty.
61 The effective protection of workers in the construction industry, particularly as regards health and safety matters and working hours, may require that certain documents are kept on site, or at least in an accessible and clearly identified place in the territory of the host Member State, so that they are available to the authorities of that State responsible for carrying out checks, particularly where there exists no organised system for cooperation or exchanges of information between Member States as provided for in Article 4 of Directive 96/71.
64 On the other hand, the mere fact that there are certain differences of form or content cannot justify the keeping of two sets of documents, one of which conforms to the rules of the Member State of establishment and the other to those of the host Member State, if the information provided, as a whole, by the documents required under the rules of the Member State of establishment is adequate to enable the controls needed in the host Member State to be carried out.
65 Consequently, the authorities and, if need be, the courts of the host Member State must verify in turn, before demanding that social or labour documents complying with their own rules be drawn up and kept in the territory of that State, that the social protection for workers which may justify those requirements is not sufficiently safeguarded by the production, within a reasonable time, of originals or copies of the documents kept in the Member State of establishment or, failing that, by keeping the originals or copies of those documents available on site or in an accessible and clearly identified place in the territory of the host Member State.
66 Where the authorities or courts of the host Member State find, as has the court making the reference in the two cases, that, as regards the keeping of social or labour documents such as labour regulations, a special staff register and an individual account for each employee, the employer is subject, in the Member State in which it is established, to obligations which are comparable as regards their objective, and which relate to the same workers and the same periods of activity, the production of the social and labour documents kept by the employer in accordance with the rules of the Member State of establishment must be regarded as sufficient to ensure the social protection of workers; consequently, the employer concerned should not be required to draw up documents in accordance with the rules of the host Member State.
76 Where, as in the present case, there is an obligation to keep available and retain certain documents at the address of a natural person residing in the host Member State, who is to keep them as the agent or servant of the employer by whom he has been designated, even after the employer has ceased to employ workers in that State, it is not sufficient, for the purposes of justifying such a restriction of freedom to provide services, that the presence of such documents within the territory of the host Member State may make it generally easier for the authorities of that State to perform their supervisory task.  It must also be shown that those authorities cannot carry out their supervisory task effectively unless the undertaking has, in that Member State, an agent or servant designated to retain the documents in question (see, to that effect, Case 205/84 Commission v Germany [1986] ECR 3755, paragraph 54).
77 In any event, the obligations to retain social documents within the territory of the host Member State for a period of five years and to retain them at the address of a natural person, as opposed to a legal person, cannot be justified.
78 Monitoring of compliance with rules concerning the social protection of workers in the construction industry can be achieved by less restrictive measures.  As the Advocate General observes in point 88 of his Opinion, where an employer established in another Member State ceases to employ workers in Belgium, the originals or copies of the social documents comprising the staff register and the individual accounts, or of the equivalent documents which the undertaking is required to draw up under the legislation of the Member State of establishment, may be sent to the national authorities, who may check them and, if necessary, retain them.
79 For the rest, it should be noted that the organised system for cooperation and exchanges of information between Member States, as provided for in Article 4 of Directive 96/71, will shortly render superfluous the retention of the documents in the host Member State after the employer has ceased to employ workers there.
80 The answers to be given to the questions referred must therefore be as follows:
(1) Articles 59 and 60 of the Treaty do not preclude the imposition by a Member State on an undertaking established in another Member State, and temporarily carrying out work in the first State, of an obligation to pay the workers deployed by it the minimum remuneration fixed by the collective labour agreement applicable in the first Member State, provided that the provisions in question are sufficiently precise and accessible that they do not render it impossible or excessively difficult in practice for such an employer to determine the obligations with which he is required to comply.
(2) Articles 59 and 60 of the Treaty preclude the imposition by a Member State on an undertaking established in another Member State, and temporarily carrying out work in the first State, of an obligation - even if laid down in public-order legislation - to pay, in respect of each worker deployed, employers' contributions to schemes such as the Belgian `timbres-intempéries' and `timbres-fidélité' schemes, and to issue to each of such workers an individual record, where the undertaking in question is already subject, in the Member State in which it is established, to obligations which are essentially comparable, as regards their objective of safeguarding the interests of workers, and which relate to the same workers and the same periods of activity.
(3) Articles 59 and 60 of the Treaty preclude the imposition by a Member State on an undertaking established in another Member State, and temporarily carrying out work in the first State, of an obligation - even if laid down in public-order legislation - to draw up social or labour documents such as labour regulations, a special staff register and an individual account for each worker in the form prescribed by the rules of the first State, where the social protection of workers which may justify those requirements is already safeguarded by the production of social and labour documents kept by the undertaking in question in accordance with the rules applying in the Member State in which it is established.
That is the position where, as regards the keeping of social and labour documents, the undertaking is already subject, in the Member State in which it is established, to obligations which are comparable, as regards their objective of safeguarding the interests of workers, to those imposed by the legislation of the host Member State, and which relate to the same workers and the same periods of activity.
(4) Articles 59 and 60 of the Treaty do not preclude the imposition by a Member State on an undertaking established in another Member State, and temporarily carrying out work in the first State, of an obligation to keep social and labour documents available, throughout the period of activity within the territory of the first Member State, on site or in an accessible and clearly identified place within the territory of that State, where such a measure is necessary in order to enable it effectively to monitor compliance with legislation of that State which is justified by the need to safeguard the social protection of workers.
(5) Articles 59 and 60 of the Treaty preclude the imposition by a Member State on an undertaking established in another Member State, and temporarily carrying out work in the first State, of an obligation - even if laid down in public-order legislation - to retain, for a period of five years after the undertaking in question has ceased to employ workers in the first Member State, social documents such as a staff register and individual accounts, at the address within that Member State of a natural person who holds those documents as an agent or servant.