In his Opinion
delivered on 26 April 2018 (C-18/17),
Advocate General Wahl. clarifies the relevance of the European Law in
determining the rules applicable to atypical “posting arrangements”.

The case in the
main proceedings

An
undertaking established in Italy (D1) has concluded a contract of provision of
services with an Austrian undertaking, to carry out construction work.

To provide
the service, (D1) wished to deploy to Austria, Croatian nationals employed by an
undertaking established in Croatia (D2), and third-country nationals employed
by another undertaking established in Italy (D3). The undertakings D1, D2 and
D3 belong to the same group and the workers were transferred by D2 and D3 to D1 (the workers are employed by D2 and
respectively D3 and subjected to the social security system in Croatia and
respectively in Italy).

D1 has
registered the workers with the competent authority in Austria, in the capacity
of posted workers. The Austrian
authority has rejected the application for confirmation of the posting. Where there
is no employment relationship between the workers and D1 (the undertaking has
concluded the contract of provision of services), pursuant to the national
legislation, a work permit Is required.

Questions referred
for a preliminary ruling

The Supreme
Administrative Court of Austria, has referred to the ECJ two questions can be
summarised as follows:

Whether
considering the atypical “posting
arrangements”, Articles 56 and 57 TFEU (freedom to provide services) and the
Posting of Workers Directive (96/71/EC), preclude Austria from requiring a work
permit for:

·       Croatian
nationals (inter alia bound by restrictions to the free movement of persons,
pursuant to the 2012 Act of Accession).

·       Third-country
nationals.

Opinion delivered
by Advocate General Wahl

Interpreting
the Directive 96/71/EC, AG Wahl clarifies the type of posting applicable to
such atypical arrangements, and in turn, the compatibility with the EU law of
the requirement of a work permit in the present case (notably with Articles 56
and 57TFEU and where applicable, the transitional provisions annexed to the
2012 Act of Accession).

AG Wahl
observes that prima facie, the atypical arrangements “fit somewhat uneasily into the situations referred to in Article
1(3)(a) and (c)” (i.e. Directive 96/71/EC).

However,
the scope of the said directive is to cover different situations in which
workers are transferred from one Member State to another in the context of
cross-border provision of services. In context, the directive covers provision
of services under a contract concluded between an undertaking
and the party for whom the services are intended and the hiring out of workers for use by an undertaking in
the framework of a public or a private contract.

In the
present case, workers employed by D2 and D3 have been transferred from Croatia
and respectively Italy to a user undertaking D1 established in Italy and operating
in the host Member State (Austria).

In regard
to the qualification of such transfer, recalling settled case-law of the ECJ (Vicoplus
and Others and Martin Meat), AG Wahl observes that the (cross-border) service
provided constitutes hiring out of workers.

AG Wahl
clarifies on the one hand the relevance of the Directive 96/71/EC in
determining the type of posting, and on the other hand, in identifying the
undertaking making the posting : the undertakings D2 and D3 established in
Croatia and respectively Italy, are posting workers to Austria, by means of
hiring out such workers to
the undertaking D1, established in Italy and operating in Austria, for the
purpose of the provision of services, in the frame of a contract concluded between
the latter and an undertaking established in Austria.

Having
regard to such determinations, pursuant to Articles 56 and 57 TFEU interpreted
in the light of settled case-law of the ECJ, and considering the transitional
provisions annexed to the 2012 Act of Accession, AG Wahl takes the view that:

·        The
work permit requirement imposed to Croatian nationals (have not been active on
the labour market in Italy) is justified.

·        As
the case at issue, Articles 56 and 57 TFEU interpreted in the light of settled
ECJ case law (Essent), preclude Austria from requiring a work permit for
third-country nationals.

To clarify
the doubt in regard to the fact that the undertakings D3 and D1 are both established
in Italy, AG Wahl recalled that “it is
only when all the relevant elements of the activity in question are confined
within a single Member State that the provisions of the Treaty on freedom to
provide services may not apply”.

 Insights on and beyond the Opinion
delivered

·       The
EU Commission and the applicants have argued for a broad interpretation of the
concept of ‘employment relationship’ (in the context of employment by undertakings
belong to the same group). AG Wahl takes a different view. It will be
interesting to assess the same situation, considering a coordinating contract
of employment (“global employment contract”) concluded between two or more
undertakings belong to the same group and a worker. In the light of the broad
scope of the Posting of Workers Directive (underlined by AG Wahl), and pursuant
to Article 63 Brussels I Regulation-recast- (i.e. the association of legal
persons referred to as Employer, is domiciled at its principal place of
business), does the said directive preclude a “global employer” from posting a
worker from its principal place of business to an undertaking established in
another Member State?

·        AG
Wahl emphasises that the ECJ has attached little importance to the fact that undertakings
hiring out workers are not temporary work agencies. However, in general, under
the law applicable in different Member States, only temporary work agencies may
hire out workers (e.g. Legislative Decree No. 81/2015 in Italy). The question
is whether an undertaking established in a Member State, posting workers to an
undertaking established in another Member State, by means of hiring out such
workers to an undertaking established in the first Member State, fails under
the national legislation governs the hiring out of workers.

·        The
Opinion has relevance to the questions referred by the Administrative Court of
Austria to the ECJ In Michael Dobersberger (C-16/18).