November 2006 http://ec.europa.eu/dgs/legal_service/arrets/04c452_en.pdf
C-452/04 Fidium Finanz AG v Bundesanstalt für
Finanzdienstleistungsaufsicht, judgment of 3.10.2006
Freedom of movement / Internal market – Relationship between freedom to
provide services and freedom of movement of capital, activities of an
undertaking established in a non-member country
The Swiss undertaking, Fidium, granted credit, on a commercial basis, mainly to
customers established in Germany. In 2003, since it did not have the authorisation
required to operate in Germany, the BaFin (Bundesanstalt für
Finanzdienstleistungsaufsicht) prohibited Fidium Finanz from carrying on lending
activities in Germany. Considering that that decision constituted a restriction on the
free movement of capital, Fidium Finanz brought an action before the
Verwaltungsgericht (German Administrative Court), which applied to the Court for a
preliminary ruling to determine whether the activity of granting credit on a commercial
basis constituted a provision of services or whether it fell within the free movement of
capital.
These issues are important because the Treaty provisions on the freedom to provide
services (Article 49) cannot be invoked by providers of services who are citizens of a
non-member country and are established outside the European Union, unlike the
provisions concerning the free movement of capital (Article 56)1
.
In its analysis of the relationship between these two freedoms, the Court observed
that, although closely linked, those provisions were designed to regulate different
situations and they each have their own field of application. The Court stated clearly
that there was no order of priority between them and rejected the theory that the
provisions concerning the freedom to provide services had less weight than those
governing the free movement of capital.
The main point was to what extent, where a national measure relates to the freedom
to provide services and the free movement of capital at the same time, the exercise of
those fundamental liberties is affected and whether, in the circumstances of the main
proceedings, one of those prevailed over the other. While it is possible in certain cases
for a national provision to impede the exercise of both freedoms at once, the Court
held that the national measure should be examined in relation to only one of the two
freedoms.
In this case, the Court observes that the activity of granting credit on a commercial
basis concerns, in principle, both the freedom to provide services within the meaning
of Articles 49 EC et seq. and the free movement of capital within the meaning of Article
56 EC et seq. With respect to services, the Treaty provisions could not be relied on by
an undertaking established in a non-member country, such as Fidium Finanz. As
regards the free movement of capital, while it was possible that the national regime
had the effect of reducing cross-border financial traffic relating to credit services, that
was merely “an unavoidable consequence of the restriction on the freedom to provide
services”. In the circumstances of the case the predominant consideration was
freedom to provide services rather than the free movement of capital.
The Court concluded that there were no grounds for examining the compatibility of the
national rules with the free movement of capital.
1
In this case, international law does not change the situation given that the agreement between the
European Community and its Member States, on the one hand, and the Swiss Confederation, on the other,
on the free movement of persons, which concerns in particular the provision of services on the territory of
the contracting parties, had not yet come into force at the time of these facts.