Social Services of General Interest (SSGI)

Eilmansberger/Herzig
In the context of the freedom to provide services and the freedom of establishment the
Court of Justice uses a formula that differs from the one applied in the Keck ruling. The
criterion used by the Court is whether the national measure would be such that it hinders the
exercise of these two freedoms or makes them less attractive. 63 However, in applying this
formula the Court of Justice appears to have followed the Keck logic in some instances.
Thus the Court of Justice decided in the Pfeiffer case that such national measures were
to be seen as relevant restrictions of access to certain activities in the country of establishment
which operated, in law and in fact, to the detriment of undertakings whose seat was in another
Member State, and it confirmed that the challenged prohibition under national law of using a
certain trade name was contrary to the Treaty as such a restraining order was liable to
constitute an impediment to the realisation by those undertakings of a uniform advertising
concept at Community level. 64 In the Cipolla case the Court of Justice decided that the
freedom to provide services would conflict with the application of national rules which had
the effect of making the provision of services between Member States more difficult than the
provision of services purely within one Member State, and considered it basically possible
that this could also apply to any national scale of lawyers’ fees which deprived lawyers
established in another Member State of the possibility, by requesting fees lower than those set
by the scale, of competing more effectively with lawyers established on a stable basis in the
Member State concerned. 65
That greater difficulties in providing services across borders than within a Member
State are a relevant criterion also within the context of the freedom of movement and the
freedom to provide services is substantiated by the fact that the Court judges national
restrictions on carrying out any work (e.g. required entry on the trades register) by whether
this is a case of freedom to provide services or of freedom of establishment. 66 The rationale
behind this differentiated approach can only be that, as a rule, provisions concerning certain
occupational activities or skilled trade work constitute an equal burden on established
domestic and foreign undertakings and are thus not suited to specifically restrict any crossborder
procedures of establishment, while the application of rules concerning the performance
of work to undertakings which want to be active in the Member State in question only
occasionally and temporarily will frequently be under a comparably greater burden, especially
so when such restrictions on carrying out work subjects such service providers to a double
regulatory burden.
1.2.3. Special case: needs test
The situation is different for needs testing. Rules on needs assessment involve very
serious restrictions that are not limited to situations where specific services are subjected to
specific rules and are thus only meant to define the way in which services are rendered or
which requirements are to be met for providing or using such services. In respect of such
restrictions, and based on the above considerations, one could argue convincingly that the
defining criterion should be whether restrictions hinder the cross-border provision of services
63 e.g. Case C-19/92, Kraus, ECR 1993, I-1663, par. 32; Case C-299/02, Commission v Netherlands, ECR
2004, I-9761, par. 15; Case C-140/03, Commission v Greece, ECR 2005, I-3177, par. 27; Case C-55/94,
Gebhard, ECR 1995, I-4165, par. 37.
64 Case C-255/97, Pfeifer, ECR 1999, I-2835, par. 19 f.
65 Case C-94/04, Cipolla, ECR 2006, I-11421, par. 57 ff.
66 For instance, the requirement of entry on a trades register as such is unobjectionable (and thus compatible
with the freedom of establishment) in the opinion of the ECJ, but the same is not true for undertakings
which intend to provide services in the host Member State only on an occasional basis (incompatible with
the freedom to provide services); Case C-58/98, Corsten, ECR 2000, I-7919, par. 45
18