Commission refers Austria to Court of Justice and closes a case against Cyprus on restrictions to provision of certain services

Further information:

Austrian legislation imposes a number of requirements on regulated professions, which the Commission argues create unjustified obstacles to the provision of services by these professions and run counter to the freedom to provide services and to the Services Directive.

In addition, the Commission also decided to close a case against Cyprus regarding a 100% shareholding requirement imposed on engineering companies which are incorporated in Cyprus. The provision under the Cypriot law meant that all shareholders of such companies had to be qualified professionals and all voting rights had to belong to them.

Background information:

The objective of the Services Directive (Directive 2006/123/EC) is to realise the full potential of services markets in Europe by removing excessive legal and administrative barriers to trade

Austria was requested to remedy the breach of EU law, first in a letter of formal notice sent in June 2015, then in a reasoned opinion in February 2016 and, following an exchange with the Austrian authorities, a complementary reasoned opinion in November 2016. As the Austrian authorities maintained their position, the Commission decided to refer Austria to the CJEU.

Following the Commission's decision in November 2016 to refer Cyprus to the Court, the country amended the law allowing a simple majority of capital shares and voting rights to be held by professionals. On this basis, the Commission decided to close the case.

The European Commission decided on 7 December 2017 to refer Austria to the Court of Justice of the European Union (CJEU) due to overly restrictive rules on the provision of services by architects, engineers, patent attorneys and veterinarians.

At the same time, the Commission decided to close a case against Cyprus as the country addressed the Commission's concerns and removed restrictions on engineering companies.