In order to promote competition, eu enacted so called four freedoms, that is, freedom

of service, freedom of establishment, freedom of goods and freedom of persons.

These four freedoms is to ensure the market is open and deregulated and that the
member state can place the restriction on the transfer abroad of administrative seat
and of the register office of person and company. Scrutinising EC secondary
legislation is one of the ECJs original task, avoiding weak compromise of the service
directive on the matter of tax and right of insolvency. As the European union steadily
enlarging, the law-making become more and more difficult, the different view and
argument, many different legal and culture traditions have to be integrated and the
clear concise ruling by ECJ make it a reliable cornerstone eu integration, with
growing importance.
The four freedom of movement within EU is facilitated by the principle of non-
discrimination and mutual recognition. The movement beyond EU will involved much
greater amount of regulations and legislation. Freedom of service, one of the
important part of fundamental freedom of eu law, characteristic of internal market. It
is governed by article 56 and 57 of tfeu. Similar with article 49, article 56 prohibit the
restriction of freedom to provide service between the member state. Besides, any
discrimination concern in the service provider on the basis of nationality will be
prohibit directly by this article without the need of any specific eu legislation.
While article 57 provides that service shall be considered as such that they are
normally provided for remuneration, in so far, as they are not govern by any other
provision of the freedom of goods, establishment and person. This article specifies
that the provision of free movement of service cover all activities of industrial and
commercial character or of craftsman and the activities of professional. Thus, what is
service? How does it distinct from the freedom of goods or establishment? The
different between the goods and service is relatively simple. The goods are the
things that one can feel. Thus, electricity is considered by CJ as a good. While the
sale of ebook(for example) will be considered as a service, as there is no tactile
object in the transaction. If the ebook is in the CD, then the CD will be considered as
good. Sometime the service will attached to the physical things. This is notable in
Schindler, the court found that buying the lottery feel within the scope of freedom of
service, not goods. This is because, the physical ticket is purely ancillary to the real
substance of the transaction, which was the chance of winning a prize. The customer
is paid in order to participate the lottery rather than to own a piece of paper.
On the other hand, the freedom of service and establishment is almost the same.
They both prohibit the restriction and stipulate that the exercising of freedoms must
be abide by the local conditions. They also have the same justification for restriction.
The main different between service ad establishment is, service is pursuing
economic activity on a temporary basis. While the establishment is setting up of
branches and agencies on a stable and continuous basis.
Next, in order to establish the right of freedom of service, few conditions have to be
presence. For example, the the service must be a cross-broader one. Article 56 will
not be applied in a purely internal situation. For example, in Kostler, the bank provide
a service of stock exchange and current account transaction, to a customer
established in France. CJ held that there is a provision of service had taken up
residence in another MS before the termination of the contractual relations between
the parties. Besides, as Article 57 held in above, the service must be a commercial in
nature, they must normally provided for remuneration. Sodemare established that
the service will not lose their commercial nature simply because they are provided by
non-profit organisation nor they lose their economic nature because there is such a
chance involved as in Schindler.
In concern of education, Wirth shows that the education will not be a service as long
as it is state essentially fund public education. This will fall outside the article 56. But,
if it is provided by the institution which seeks to make profit or if the payment is make
by the student or their parents and large part of the payment is received for the
serviced provided, then these payment will be a remuneration for the service and fall
within article56. In Zanotti, it seems to suggest that even in a largely state-financed
institution, the individual course which is provided for remuneration will be within
article 56. Furthermore, CJ must be nuanced against the background of his case law
which regarding the cross-border healthcare. In Geraets-Smith(Peerbooms), both
applicant have paid for their medical treatment abroad without the prior authorization
from the Ducth sickness insurance scheme for low income people. The CJ rejected
the argument which held that the provision of hospital care could not constitute a
service covered by article 56. Claimant have paid for the medical treatment received
in another MS, thus fulfilling the economic activity requirement.
Moreover, it has never be in doubt that the direct and indirect discrimination is
prohibited within the sphere under article 56. In Arblade, CJ held that it is a settled
case law that article 56 require not only the abolition of all the discrimination on the
basis of nationality against the provider of services who are established in another
MS, but also abolish any restriction, even if it is applies without any distinction to the
national provider of service and the service provider who established in another Ms,
which is liable of hinder, impede and render less advantage the activities of provider
of service established in another ms where he lawfully provide similar service. Both
direct and indirect discrimination also been prohibited under article 57. Gouda, which
held that article 53 entails that the abolition of any discrimination against the person
who provide services on the ground of his nationality or the fact that he is
established in another MS other than the one the service is provided. National rules
which are not applicable without discrimination as regard their origin are compatible
only in so far they can be brought within an express exemption such as that
contained in article 52.
The case there was such discrimination is FDC. Spanish Law provided that the film
distributor granted a right to dub the foreign language film of the ground that they will
distribute a Spanish Film in the same time. According to CJ, the rule was breached
article 56 because it gave a preferential treatment to the producer of national films in
comparison with the producer established in other MS, since the former have a
guarantee that their film will be distributed but the later will need to depend solely on
the choice of the Spanish distributers. The obligation to distribute a Spanish film
therefore had an effect of protecting the undertaking national films and by the same
time established in other MS at disadvantage. For an indirect discrimination, in
Binsbergen, where a Ducth rule requiring representative to be reside in Netherland ,
was found to be breach of article 56, although it could be objectively justified on the
ground of professionals rules of conduct connected with the administration of justice,
it is disproportionate.
Additionally, in Cowan v Tresor, Cowan(a uk citizen) mugged whilst holiday in
French. French law only allowed criminal compensation to the French nationals.
Although compensation did not constituted a service, but refusal to compensation
constituted an obstacle to access or purse the other services. This was breached of
article 56. This case recognise the non-discrimination principle. As with other
freedoms, CJ evolved to a point where not just discriminatory rule are prohibit under
EU law, but also measure which are liable to prohibit or otherwise impede the
activities of a provider of service. In Gebhard, CJ found that all nationals measure
which are liable to hinder or make less attractive the exercise of fundamental
freedoms are to be seen as restriction on movement. Though this case is about
establishment, but the formulation was general and always cited for services too!
The view of Gebhard was reflected in Alpine Investment, where the restriction was
the Dutch prohibition on cold-calling, that is, making call without prior consent to offer
service or offices, although cold-calling in other MS was not prohibited. This
frustrated the Dutch provided who want to call her client in German, claim the
measures was a restriction on services. The court agreed, on a straightforward
reason that, such a prohibition deprives the operators concerned the rapid and direct
technique of marketing for contracting the potential client in other MS. It can
therefore a restriction on the freedom to provide cross-border services. In Mobistar,
the court took a more precise and limited approach to article 56. Mobistar was about
a tax on telecoms masts and pylons necessary for the transmission of phone cal. CJ
held that the municipal tax on the pylons and masts which need to GSM
communication, which apply without distinction to the national service provider and
the provider established in another MS and have the same effect the provision did
not breach article 56 were the only effect was to create additional cost on respect of
the service in question. A similar approach also taken by Viacom Outdoor, which
concerned a tax on bill-posting restriction on advertising service.
The analytical structure of law on services is summarised in Gebhard. As with the
law on other freedoms, the restriction on the freedom of services will be justified if, it
is equally applicable to the national and foreign provides of services, justified by
some legitimate public interest objective and proportionate to the objective. If the
restriction is not equally applicable, but discrimination on its face, then it may only be
saved by the Treaty exceptions. For example, in Omega, there is a laserdome
centre in Germany. It held that people shooting each other was against the
fundamental values and public opinion. CJ held that both germany and eu obliged to
protect the human dignity therefore the restriction is justified. Another justified
exception is public health, in Kholl, the restriction on refunds for medical costs in
another MS are also justified as they undermine the availability of balanced medical
and hospital services.
 In regard to the three conditions in Gebhard, an example case is Guiot. Here
the employers were required to pay for the social security payment for the workers in
Belgium. This is not only apply to the company and its workers are established in
Belgium, also applied to the employers who are established in another MS, but
temporary posted their workers to Belgium to provide services. CJ held that the
compulsory social security is justified in general to protect the worker, but imposing
them on the companies that might be provide the same contributions in their home
state, without taking account of this, was disproportionate. It is also disproportionate
to subject the service provider to all the rules which will applies to them is they
established at there. While, in Sager, German government obstructed the provision
of patent service in german by patent agent based in UK. They did not possess the
qualifications require in Germany for the service they providing. CJ did not object the
German provision as such appropriate rules on qualifications are a way of protecting
the consumer in complex and technical fields.
In Commission v Germany, the logic of the internal market is that, as far as
possible each economic actor should be subject to the law of their home state,
mutual recognition should ensure that other state shall recognise the adequacy of
this law and permit the actor to do business on their national market without further
ado.