Free Movement of Services
The free movement of services and of establishment allows self-employed persons to move between member states in order to provide services on a temporary or permanent basis. While services account for between sixty and seventy percent of GDP, legislation in the area is not as developed as in other areas. This lacuna has been addressed by the recently passed Directive on services in the internal market which aims to liberalise the cross border provision of services. According to the Treaty the provision of services is a residual freedom that only applies if no other freedom is being exercised.
The Free Movement of Services is established in Article 56 TFEU, with further guidance in Article 57 – 62 TFEU. Exceptions are found in Articles 51-55 TFEU (common with Freedom of Establishment). The freedom prohibits restrictions on free circulation of services within Member States. Services are defined in the negative, “they are normally provided for remuneration, in so far as they are not governed by the provisions relating to freedom of movement for goods, capital and persons.” (Art. 57 TFEU)
The services are distinguished from freedom of establishment based on their temporary rather than permanent nature and from free movement of workers based on the fact that the freedom affects corporate entities and individuals outside of the relationship of employment. Chapter 3 of Title IV applies to services as long as either the service moves across the border, or the provider moves or the service itself moves (e.g. an internet purchase).
The freedom to provide services is directly effective, meaning that member states must ensure that national laws do not conflict with the provisions. The Court has recognised that the obstacles to freedom to provide services may arise both from discriminatory and indistinctly applicable rules.
Two directives are also of particular relevance - the Posting of Workers Directive, sometimes referred to as the Posted Workers Directive, and the Directive on services in the internal market.
Read more about this topic: Internal Market
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