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CAPITAL MOVEMENTS VS. FREEDOM OF ESTABLISHMENT AND FREEDOM TO PROVIDE SERVICES IN THE CASE-LAW OF THE CJEU

Gina ORGA-DUMITRIU

First published: 2023https://doi.org/10.35603/sws.iscss.2023/s02.02View metrics

Abstract

The Treaty of Rome promoted a more cautious approach as concerns the free movement of capital in comparison with other fundamental economic freedoms. The recognized importance of the sovereign prerogatives of the states in the field of monetary policies explains why its original regulatory wording bears the signs of a reserved attitude and of an increased concern for the balance of powers distributed between the Commission, the Council and the Member States. The full liberalization of capital movements is the result of a legislative interventions in stages that culminated in the Directive of 24 June 1988 and the Maastricht Treaty, which laid down the free movement of capital not only in the relations between Member States but also in the relations with third countries. Thus, through a paradoxical dynamic, the capital movements enjoy a wider territorial scope compared to the other freedoms (of goods, persons and services) which are applicable only in intra-European cross-border situations (I). The study aims at analysing the recent interpretations of the Court of Luxembourg regarding particular illustrations of the notion of capital movements (II) and highlights the elements of added value regarding the delimitation of the free movement of capital from the freedom of establishment (III), and from the freedom to provide services (IV), respectively. In accordance with the reasoning of the Court, the provisions of Article 49 TFEU on freedom of establishment will be the ones that will apply, to the extent the shares held within a company allow the exercise of a definite influence on the decisions of a company. In exchange, the participations made only with the intention of making a financial investment, without the intention of influencing the management and control of the companies, must be analysed by reference to Article 63 TFEU on the free movement of capital. The distinction between the capital movements and the freedom to provide services provided in Article 56 TFEU arises in the presence of a regulation on the provision of financial services and proves to be much more delicate in practice. The national measure will only be examined from the perspective of one of these two freedoms if, in the circumstances of the case, one of them is entirely secondary to the other and can be linked to it.

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Title
CAPITAL MOVEMENTS VS. FREEDOM OF ESTABLISHMENT AND FREEDOM TO PROVIDE SERVICES IN THE CASE-LAW OF THE CJEU
Authors
Gina ORGA-DUMITRIU
Proceedings
Proceedings of 10th SWS International Scientific Conference on Social Sciences - ISCSS 2023
Publisher
SGEM WORLD SCIENCE (SWS) Scholarly Society
Year
2023
Pages
37-48
SWS Citekey
ORGA-DUMITRIU20232111
ISSN
2682-9959
ISBN
978-3-903438-06-4
Language
en
Publication type
Proceedings Paper
Keywords
free movement of capitalfreedom of establishmentdisposal of assetsgroup of companiesfreedom to provide servicescompany lawreference for a preliminary ruling
References20

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  19. Opinion of Advocate General Kokott in Case C-78/21, PrivatBank and Others, ECLI:EU:C:2022:738, para 44.

  20. Case C-78/21, PrivatBank and Others, ECLI:EU:C:2023:137, para 55.

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