AG Cruz Villalon in Case C-221/11 Demirkan: Selective Associationism

In Demirkan, the Court will have the difficult task to decide whether Article 41 (1) of the Additional Protocol to the 1963 Association Agreement between the EU and Turkey may actually extend to the passive freedom to receive services (the freedom to move to a Member State to receive a service). In his opinion presented last Thursday, Advocate General Cruz Villalon suggests the Court should say no – based on somewhat conventional, yet interesting arguments which use the rules of interpretation of the Vienna Convention on the Law of Treaties in a very selective way.

Article 41 (1) of the Additional Protocol is a stand-still clause which provides that ‘[t]he Contracting Parties shall refrain from introducing between themselves any new restrictions on the freedom of establishment and the freedom to provide services’. It does not provide for the freedom to provide services itself, but – like the Association Agreement – it requires the Council of Association to take the necessary steps to remove obstacles to that freedom.

As the Advocate points out, the problem in the present case arises now from the combination of the Court’s case law and secondary legislation. Regulation (EC) 539/2001 and (EC) 562/2006 establish that third country nationals coming from a country on a specific list (which includes Turkey) must be in possession of a visa when crossing the external border of a Member State for stays not exceeding three months. In its decision in Soysal and Savatli , however, the Court held that the stand-still clause of Article 41 (1) of the Additional Protocol also applied to a visa requirement introduced by Germany back in 1980 which applied to the entry of Turkish nationals for the purposes of providing services, in that case related to the international transport of goods for a Turkish-registered company. The Court thus struck down the German visa requirement as a new restriction on the freedom to provide services because of the ‘additional and recurrent administrative and financial burdens involved in obtaining such a permit’ (Soysal and Savatli, para 55). The secondary legislation in place was of no concern to the Court, as ‘the primacy of international agreements concluded by the Community over provisions of secondary Community legislation means that such provisions must, as far as is possible, be interpreted in a manner that is consistent with those agreements’ (Soysal and Savatli, para 59). As the Advocate General points out, both the Commission and Germany are already working on the modifications necessary to implement the decision in Soysal and Savatli.

The Soysal and Savatli case, however, fails to answer a central point concerning the potentially broad notion of the freedom to provide services embraced by Article 41 (1): Is the passive freedom to provide services also encompassed by Article 41 (1)?

 The Advocate General starts by pointing to the situation in EU law, where – despite the important effects on the movement across borders of natural persons for this purpose – the passive freedom to provide services is part of the EU fundamental freedom (paras 50-51).

In order to determine the scope of Article 41 (1), he suggests the rules of interpretation of international law (para 53). The Vienna Convention rules are certainly a help, but they essentially remain broad guidelines which allow the balancing of various rules of interpretation – as becomes particularly clear in the interpretative exercise suggested here by the Advocate General.

Beginning with the wording of the provision, the Advocate General blends some historical elements into his analysis. The historical understanding of the freedom to provide services at the time the Additional Protocol was concluded is hard to establish, since the Court only clarified matters in 1984 (para 55). As a comparison, even in the 1999 Agreement on the Free Movement of Persons with Switzerland, the freedom of movement of service recipients is explicitly regulated to avoid any confusion (para 57), setting out the conditions to be fulfilled for service providers and recipients to be entitled to move to the partner state.

Moving on to the context, the Advocate General rightly emphasizes the role of the Council of Association in furthering integration under the Association Agreement’s regime (para 58). Since the Association Agreement does not contain provisions mirroring the respective provisions on the fundamental freedoms in the TFEU, the standstill clause’s content is also rather limited (para 59). The Agreement speaks instead of the Association being ‘guided by’ the Treaty freedoms, which the Court interpreted as extending EU free movement principles only ‘so far as possible [sic]’ (para 60-61).

These arguments appear quite convincing. What follows, however, is marked by a feature which is unfortunately common to much of the case law on EU external agreements: a highly selective teleological reading of the Agreement at issue. Turning to the objectives of the EU Turkey-Association Agreement, the Advocate General correctly emphasizes that such objectives played a pivotal role in deciding what degree of integration was desired in a specific association regime (paras 62-63). The Advocate General finds it to be a ‘programme for integration’ rather than a ‘complete, immediately applicable and comprehensive treaty’; the Association Council has a major role to play in establishing fundamental freedoms. In practice, this entails a lot of progress in the field of trade in goods, but rather insignificant progress in other areas such as the freedom to provide services (para 66). By contrast, the EU aims at an internal market which includes integration beyond the individual citizens’ economic activities. Union citizenship thus illustrates that – contrary to the EU-Turkey association – the objectives of the EU go far beyond economic integration (para 67). For the Advocate General, the passive freedom to provide services is so intrinsically linked to the free movement of persons, an ‘area of such sensitivity’, that it ought not to be transferred to the stand-still clause of the Additional Protocol. This is so because in the EU context, this passive freedom was an ‘initial step towards the establishment of free movement for Union citizens’ (para 69). Therefore, the passive freedom to provide services is not a part of the stand-still clause, which is also confirmed by subsequent practice of the contracting parties, several Member States and Turkey having introduced at some points visa restrictions against the other (paras 70-71).

As a first sceptical remark, the Advocate General is distinguishing between the two legal regimes using different criteria: for the EU, he uses the objectives of the Treaties; for the EU-Turkey Association Agreement, he bases his findings on the effective use made of the provisions of the Agreement. The EU-Turkey Association Agreement can arguably also be read as a rather ambitious ‘programme for integration’, with actual accession being mentioned as the ultimate goal. But if, like the Advocate General, we define ‘objectives’ as the progress actually being made, the result is of course less impressive. Second, one may also have doubts as to whether the – essentially still economic – passive freedom to provide services is as intrinsically linked to the concept of Union citizenship as the Advocate General implies. Third, the rather selective reading of the objectives and structure of the Agreement reminds me of the approach of the CJEU towards the Agreement on the Free Movement of Persons between the EU and Switzerland. For both the Ankara Agreement and the Swiss Agreement, it is hard to shake the impression that the Court – or here the Advocate General – decides first which result ought to be reached, with the reasoning being then adapted to fit that result. In the case of the Swiss Agreement, an interesting trend can thus be identified: Initially, the Court insisted very much on the fact that Switzerland chose not to accede to the European Economic Area and to exclude accession to the EU when concluding the Bilateral Agreements (Grimme, Fokus Invest), all that to interpret the Agreement restrictively. Later case law, however, rather miraculously rediscovers the integration-friendly preamble of the Agreement and thus allows for a much more EU-law based interpretation (see Graf, para 33).

All that to say that one could probably have found respectable arguments to extend to some more limited extent the passive freedom to provide services and allow more comprehensive restrictions as justified than in the EU context. With this approach, a less restrictive reading of the Association Agreement and its Protocol could have been reached, while the case at hand still could have been easily dismissed (as the Advocate General also does in the second part of his opinion, pointing towards the ancillary character of the passive freedom to receive services in the concrete circumstances of the case, paras 78-79).

At the end of the day, one may agree or disagree with the result reached by the Advocate General. What I find of concern is, however, mainly the nearly arbitrary way in which external agreements of the EU are interpreted, sometimes in a minimalist, sometimes in a maximalist fashion. As a consequence, fundamental freedoms of the Common Market are sometimes extended, sometimes not; and many of us would probably like to hear a bit more than the mantra of the Vienna Convention rules of interpretation as an explanation for this inconsistent approach.