• In the case of Case C-55/94 Reinhard Gebhard [1995] ECR 4165, it was established that Chapter 2 and 3 in the TFEU in respect of one’s Right of Establishment and Services are dissimilar, and cannot apply together. The Right of Establishment assumes the provider and receiver of the Services under Chapter 3 are of different states, as per Article 56 TFEU. Thus, the Right of Establishment would not apply (Article 57). This case also provides that, as long as they are proportionate, any restrictions upon the Right of Establishment may be subject to the Member State laws applying to the service provided. The national measures mustn’t be discriminatory and are justified by imperative requirements of general interest, seeking to attain the objective pursued whilst not going beyond what is necessary to achieve this.

Facts of Case C-55/94 Reinhard Gebhard [1995] ECR 4165

  • Gebhard was a German national practising as a lawyer in a set of chambers in Milan
  • Later, he opened his own chambers in Milan
  • The letterhead he used for professional purposes used the title ‘avvocato’, which the Milan Bar Council had barred him from using
  • Following complaints, disciplinary proceedings were opened against him; he later was suspended from pursuing his professional activity
  • Gebhard appealed against this decision, believing Directive 77/249 entitled him to pursue his career from his own chambers
  • This Directive allows a lawyer to provide services in another Member State, provided he indicates the professional organisation which authorised him to practise
  • Gebhard challenged the compatibility of Italian law, under which he was not allowed to practise, with Community law

Issues in Case C-55/94 Reinhard Gebhard [1995] ECR 4165

  • Was the Milan Bar Council correct in their suspension of Gebhard practising?
  • Alternatively, was the restriction on Gebhard’s Right of Establishment disproportionate to Community law, and thereby incompatible?

Held by the European Court of Justice

  • Gebhard was established, and the measure by the Italian national law where he was pursuing practise was disproportionate with Community law.

Findings of the Court

As a preliminary, the CJEU established that the case concerned not the chapter on workers but, “concerned essentially with the concepts of “establishment” and “provision of services”” [21]

The concept of establishment:

  • “Article 59 assumes that the provider and the recipient of the service concerned are “established” in two different Member States and, second … Article 60 specifies that the provisions relating to services apply only if those relating to the right of establishment do not apply. It is therefore necessary to consider the scope of the concept of “establishment”.” [22]
  • “The right of establishment, provided for in Articles 52 to 58 of the Treaty, is granted both to legal persons within the meaning of Article 58 and to natural persons who are nationals of a Member State of the Community.” [23]

Chapter 2 and 3 refer to different things:

  • The Right of Establishment refers to “a stable and continuous basis, in the economic life of a Member State other than his State of origin and to profit therefrom, so contributing to economic and social interpenetration within the Community in the sphere of activities as self-employed persons” [25]
  • Whereas Services refer to “where the provider of services moves to another Member State … envisage that he is to pursue his activity there on a temporary basis.” [26]
    • “temporary nature of the activities in question has to be determined in the light, not only of the duration of the provision of the service, but also of its regularity, periodicity or continuity.” One may provide themselves with infrastructure necessary to provide the services. [27]

Applying this to Gebhard’s situation:

  • Gebhard was established as he pursued “a professional activity on a stable and continuous basis in another Member State where he holds himself out from an established professional base to, amongst others, nationals of that State. Such a national comes under the provisions of the chapter relating to the right of establishment and not those of the chapter relating to services.” [28]
  • It did not matter, as the Bar had argued, that Gebhard was not registered under Italy [29-30]

The measures were disproportionate

  • “It follows … from the Court’ s case-law that national measures liable to hinder or make less attractive the exercise of fundamental freedoms guaranteed by the Treaty must fulfil four conditions: they must be applied in a non-discriminatory manner; they must be justified by imperative requirements in the general interest; they must be suitable for securing the attainment of the objective which they pursue; and they must not go beyond what is necessary in order to attain it” [37]
  • The Member State cannot ignore the qualifications attained by the national in another State [38]

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