Facts
- Mr Van Binsbergen, a Dutch legal representative, acted for a client before a Belgian social security tribunal.
- Belgian procedural law required representatives to reside in Belgium for the whole duration of proceedings.
- During the pending action Van Binsbergen returned to the Netherlands, prompting the tribunal to question his continued right of audience under the residence rule.
- The national tribunal referred questions to the European Court of Justice on whether the residence condition was compatible with Article 59 of the EEC Treaty (now Article 56 TFEU).
Issues
- Whether Article 59 EEC prohibits a Member State from requiring a service provider to reside within its territory while performing cross-border services.
- If such a requirement restricts the freedom to provide services, whether it can be justified by an overriding public-interest objective and satisfy the tests of necessity and proportionality.
Decision
- The residence requirement restricted the freedom to provide services and therefore contravened Article 59 in principle.
- National rules affecting service providers are permissible only if they apply without direct or indirect discrimination on grounds of nationality or residence.
- A restriction must pursue a legitimate public-interest aim and be strictly necessary and proportionate; where less restrictive measures suffice, the rule is unlawful.
- Effective supervision of representatives and the proper administration of justice could be achieved by milder means; Belgium’s residence condition was consequently disproportionate, and Van Binsbergen could continue representing his client from the Netherlands.
Legal Principles
- Article 59 EEC secures the cross-border freedom to provide services and prohibits indirect discrimination, including residence requirements.
- Any national measure that hinders market access falls within the Treaty prohibition regardless of form or intent.
- Member States may regulate professional activities to protect objectives such as consumer protection or orderly justice, but such rules must apply equally to domestic and foreign providers.
- The necessity and proportionality test demands that restrictions go no further than essential to achieve the stated aim; if a less restrictive alternative is available, the measure fails.
Conclusion
The Court ruled that Belgium’s residence condition for legal representatives unlawfully impeded the freedom to provide services under Article 59 EEC. Member States may impose regulatory requirements only when they are non-discriminatory, pursue a legitimate aim, and are strictly necessary and proportionate.