Freedom of Establishment Articles 49–55 TFEU Q&A
The Freedom of Establishment Articles 49–55 TFEU Q&A series provides optimal preparation for addressing test questions. This collection of EU law notes examines questions and answers related to Freedom of Establishment contained in Articles 49–55 TFEU.
Problem Question
Anglo Pharmacia Plc (“Anglo”) is a company incorporated in England which manufactures and distributes pharmaceuticals. It has its headquarters in London.
1) Anglo is planning to open an office in Spain. The directors of the company have discovered the following:
a) Spanish law requires foreign pharmaceutical companies operating through premises in Spain to have to lodge a foreign bank guarantee with the Spanish authorities. The guarantee must be extensive enough to cover all potential liabilities to individuals who suffer harm from using the company’s drugs in Spain.
b) Spanish law also requires all pharmaceutical companies operating in Spain to supply the Spanish national health system with 100,000 Euros worth of medicine free of charge.
2) Anglo has been approached by Botas Lda, a chain of Portuguese chemists, who want Anglo to act as consultants on the use of certain pharmaceuticals from the United Kingdom. Portuguese law requires all undertakings acting as consultants or advisors on pharmaceuticals to obtain a licence to do so from the relevant Portuguese authorities.
3) Anglo has an office in Cyprus. It has run into problems with its accounting systems there. It wants to use Dirk, a Dutch national, to sort out these problems. Dirk, who is fully qualified as a chartered accountant in the Netherlands, has worked on projects for Anglo before and is widely regarded as a top troubleshooter in this area. He would be acting as an independent contractor. However, the Cypriot authorities have contacted Dirk to say that he will not be allowed to practise in Cyprus as Cypriot law prohibits anyone from practising as a chartered accountant in Cyprus without obtaining the necessary Cypriot qualification. This involves completing a degree-level accountancy course at a Cypriot University and a two year period of practical training. Anglo still wishes to hire Dirk.
4) Margreet is Dirk’s wife. She is also a Dutch national. She recently travelled to Poland in order to have an operation on her hip at a specialist clinic. Dirk paid for the operation. On the day that she arrived in Poland, she was robbed and suffered injuries in the attack. She applied to the Polish state criminal injuries compensation fund but her claim was rejected as, under Polish law, an applicant had to be either a Polish national or resident in Poland in order to be eligible for compensation from the fund.
Advise the parties of any potential breaches of EU law governing freedom of establishment and the freedom to provide services.
