Chapter 3 - The EU Regulation Of Cross-Border Establishment Of Companies

Summary

Introduction

Chapter 3 considers the regulation of the cross-border establishment of companies in the EU. In section 2 of this chapter, the evolution of the EU internal market is analysed. This shows the role of the Commission and the Court of Justice of the European Union (CJEU) in promoting market integration in the EU. Section 3 presents how the EU regulates the cross-border establishment of companies. It first elaborates on the EU Treaty provisions on freedom of the establishment of companies. Thereafter, Section 3 considers leading cases in which the CJEU has applied these provisions to national obstacles to the freedom of establishment, in order to assess the extent of this freedom. At the end of section 3, a description is provided of the relevant provisions of the Services Directive 2006/123 that codify the case law on establishment of service providers. To reflect on the practice of the freedom of establishment, section 4 discusses remaining barriers to this freedom and ways to tackle the barriers. Section 5 provides conclusions.

The Evolution of the Internal Market

Section 2 shows the evolution of the internal market of the EU since the Treaty of Rome. The development of the internal market has gone through a number of phases: from the Treaty of Rome to the Single European Act (SEA), from the SEA to the Maastricht Treaty, and from the Maastricht Treaty to the Lisbon Treaty. In chronological order, this section examines the evolution at these stages, with a particular focus on important Treaty provisions on promoting market integration. Also, specific attention is given to the contributions of the CJEU and the European Commission to the establishment of an internal market. According to Craig, apparently, the CJEU and EU institutions (especially the Commission) have interacted with each other, playing an important role in promoting economic integration. The institutions have drawn on principles of EU law developed by the CJEU in the area of the internal market, in order to shape legislative and administrative priorities. The court has been cognizant of legislative and administrative troubles with the internal market and legal doctrines have emerged from the case law to alleviate these problems.