OPINION OF ADVOCATE GENERAL
MISCHO
delivered on 26 June 2003 (1)
Case C-496/01
Commission of the European Communities
v
French Republic
(Failure by a Member State to fulfil its obligations – Freedom to provide services – Right of establishment – Rules for bio-medical analysis laboratories – Conditions for obtaining an administrative operating authorisation – Place of business on French territory)
1. In the present case, the Commission seeks a declaration that the French Republic has failed to fulfil its obligations under Articles 43 EC and 49 EC by requiring bio-medical analysis laboratories established in other Member States to have their place of business on French territory as a condition for obtaining the requisite operating authorisation and by precluding any reimbursement of the cost of bio-medical analyses carried out by bio-medical analysis laboratories established in another Member State.
I – French law
A – National public health rules
2. Article L. 6211-1 of the Code de la santé publique provides that bio-medical analyses are biological examinations which assist in the diagnosis, treatment or prevention of human diseases or which reveal any other physiological change. Laboratories may only exercise their activities under the responsibility of their directors or deputy directors.
3. Under Article L. 6221-1, laboratory directors and deputy directors must hold a State diploma for the profession of medical doctor, pharmacist or veterinary surgeon, be on the roll of the relevant professional association and have received specialised training which may be evidenced by certificates in specialised studies, exemptions or equivalent qualifications or diplomas in specialised bio-medical studies. Foreigners may also be authorised to fulfil the position of director following a specific procedure referred to in Articles L. 4221-1 and L. 4221-2 of the Code de la santé publique.
4. Under Article L. 6211-2 of the Code de la santé publique:
‘No bio-medical analysis laboratory may operate without administrative authorisation.
Without prejudice to the provisions of Article L. 6122-1 on heavy equipment, authorisation shall be granted when the conditions laid down in this Book and in the decree provided for in Article L. 6211-9 and determining the number and qualifications of technical staff and the standards applicable to laboratory fittings and equipment are satisfied.
That decree may lay down specific conditions applicable to laboratories whose activities are confined to certain procedures specified in that decree. The authorisation granted to those laboratories shall state that limitation.
...
Authorisation shall be withdrawn where the requirements laid down by law or regulation are no longer satisfied.’
5. The procedure for obtaining such authorisation is laid down in Articles 15 to 17 of Decree No 76-1004 of 4 November 1976, (2) laying down the requirements for authorisation of bio-medical analysis laboratories.
6. Article 15 of that decree provides:
‘The application for authorisation provided for in Article L. 757 [now Article L. 6211-2] of the Code de la santé publique shall be sent, by registered letter with return receipt requested, to the Prefect of the département in which the laboratory is to be operated.
The application shall state the operating conditions and the volume of activity envisaged during the first year and be accompanied by supporting documents, including, in particular:
a description and plan of the premises;
a complete list of equipment;
a list of the directors, deputy directors and technicians, including their qualifications and diplomas;
where appropriate, the company statutes.
When the operator is not owner of the equipment or the premises, he shall state the grounds on which he has the right to use thereof ... ’.
7. Where the requisite conditions are satisfied, the operating authorisation is granted to the applicant as of right. Moreover, provision is made for an on-the-spot inspection by a public health inspector who is a doctor or pharmacist.
8. Article 24 of Decree No 76-1004 establishes conditions and procedures as regards the withdrawal or suspension of authorisation by the Prefect.
9. French law lays down precise rules concerning the carrying-out of certain analyses, such as the detection of anti-HIV antibodies and immunohaematology analysis.
10. Moreover, laboratories must be operated in compliance with the rules laid down in the Guide to correct conduct of bio-medical analyses (‘the GBEA’), which is annexed to the decree of 26 November 1999 on the proper conduct of bio-medical analyses. (3)
11. The GBEA consists of a series of technical rules which define all the stages of the relevant procedure, from the taking of samples to the return of validated results.
12. The GBEA is in the nature of a regulation and, consequently, is binding on laboratories. It is therefore applicable to biologists. Failure to comply with its provisions may thus lead to withdrawal of operating authorisation.
13. The French rules also lay down constraints as regards the drafting of the reports of the results. In the case of a number of analyses, the report must contain an interpretation of the results by a biologist in order to assist the prescribing doctor in making a diagnosis.
14. Compliance with the French rules on the setting-up and operation of such laboratories is monitored by the authorities in order to ensure the protection of public health. There are two types of controls: inspections and quality control of analyses.
15. Inspections are carried out by public health inspectors who are doctors or pharmacists and by the General Inspectorate of Social Affairs (Article L. 6213-1 of the Code de la santé publique).
16. Those inspections are essentially aimed at monitoring compliance with the operating conditions for laboratories: premises, equipment, the number of directors and deputy directors, the qualifications and number of technicians, the organisation of the laboratory, the conduct of the analyses and quality assurance; and, generally, compliance with all the provisions laid down by law and regulation, in particular the GBEA.
17. The inspections are also designed to ensure that corrective measures have been taken where the results of the quality control of a laboratory have revealed repeated or significant anomalies as regards their medical use. Article 9 of Decree No 94‑1049 of 2 December 1994 on the quality control of bio-medical analyses (4) states:
‘Where the results of the quality control of a laboratory show repeated or significant anomalies as regards their medical use, the case of that laboratory shall be submitted anonymously to the Commission du contrôle de qualité (Quality Assurance Commission), which shall make a determination on the seriousness of those anomalies. Where they are deemed to be serious, the laboratory shall be reported by the Director‑General of the Agence du médicament (Medicinal Products Agency) to the Minister responsible for health, to whom the Director-General shall communicate the results for the purposes of a control pursuant to Article L. 761‑13 [now Article L. 6213‑1] of the Code de la santé publique designed, in particular, to ascertain the measures taken by the laboratory to improve the quality of its analyses.’
18. As regards quality control of analyses, Article L. 6213‑3 of the Code de la santé publique provides that such controls are to be carried out by the Agence française de sécurité sanitaire des produits de santé (French Agency for Health Product Safety) in accordance with the procedure determined by decree.
19. Those controls are designed to guarantee the quality of the results of the analyses carried out by each laboratory. They are intended to ensure the reliability and improved performance of bio-medical analyses and to allow each laboratory to establish that it is using the proper techniques and employing the correct procedures.
B – National social security rules
20. The conditions governing the reimbursement by sickness insurance funds of the cost of laboratory services are governed by the social security rules.
21. Article L. 162‑13 of the Code de la sécurité sociale (Social Security Code) provides:
‘As regards laboratory analyses and examinations, insured persons may, for each category of analysis, choose freely between approved laboratories, irrespective of the status of the operator. The conditions for approval shall be laid down in an inter-ministerial decree.’
22. Under Article L. 162‑14 of the Code de la sécurité sociale, the total cost of laboratory analyses and examinations to be reimbursed by sickness insurance funds and the insured person’s contribution are to be fixed by a national agreement between, on the one hand, the Caisse nationale de l’assurance maladie de travailleurs salariés (National Workers’ Sickness Insurance Fund) and at least one other national sickness insurance fund and, on the other, the bio-medical laboratory directors’ trade unions which are recognised as the most representative at national level.
23. Under Article 2 of the National Agreement of 26 July 1994, sickness insurance funds may not derogate from the principle of freedom to choose the laboratory as laid down in Article L. 162‑13 of the Code de la sécurité sociale. They may only refuse to reimburse any additional costs arising from the choice of a laboratory other than one of those in the area in which the insured party lives or, where there is no laboratory in that area, in the nearest area.
24. Unless the director of a laboratory gives express notification that he does not wish to be placed under the scheme set up under the agreement in force, French laboratories satisfying the conditions laid down by the rules on public health are deemed to be governed by the agreement and the costs of the analyses carried out by them are reimbursed on the basis of the tariffs fixed by the agreement and of the classification in the nomenclature of bio-medical procedures.
25. However, Article L. 332‑2 of the Code de la sécurité sociale prohibits payment of sickness and maternity insurance benefits where the insured party and his dependants receive treatment outside France.
26. Article R. 332‑2 of that code makes provision for a number of derogations from that principle. It does not permit agreements between sickness funds and laboratories established outside France. As regards medical services provided abroad, the final paragraph of Article R. 332‑2 of that code provides:
‘exceptionally, and subject to a favourable opinion from the medical supervisory body, sickness insurance funds may reimburse, at a flat rate, the cost of treatment provided outside France to an insured person or his dependants, where the person concerned establishes that he was unable to receive the treatment appropriate to his condition in France.’
II – Community law
27. Article 43 EC provides:
‘Within the framework of the provisions set out below, restrictions on the freedom of establishment of nationals of a Member State in the territory of another Member State shall be prohibited. Such prohibition shall also apply to restrictions on the setting-up of agencies, branches or subsidiaries by nationals of any Member State established in the territory of any Member State.
Freedom of establishment shall include the right to take up and pursue activities as self-employed persons and to set up and manage undertakings, in particular companies or firms within the meaning of the second paragraph of Article 48, under the conditions laid down for its own nationals by the law of the country where such establishment is effected, subject to the provisions of the Chapter relating to capital.’
28. Article 46 EC provides:
‘1. The provisions of this Chapter and measures taken in pursuance thereof shall not prejudice the applicability of provisions laid down by law, regulation or administrative action providing for special treatment for foreign nationals on grounds of public policy, public security or public health.
2. The Council shall, acting in accordance with the procedure referred to in Article 251, issue directives for the coordination of the abovementioned provisions.’
29. Article 47 EC provides inter alia:
‘...
3. In the case of the medical and allied and pharmaceutical professions, the progressive abolition of restrictions shall be dependent upon coordination of the conditions for their exercise in the various Member States.’
30. The third paragraph of Article 50 EC reads as follows:
‘Without prejudice to the provisions of the Chapter relating to the right of establishment, the person providing a service may, in order to do so, temporarily pursue his activity in the State where the service is provided, under the same conditions as are imposed by that State on its own nationals.’
III – Procedure
31. Following a complaint by a German laboratory regarding the French rules in question, the Commission services requested information by letter of 18 March 1999 to the French authorities. The French authorities replied by letter of 21 September 1999.
32. By letter of formal notice of 1 February 2000, the Commission indicated to the French Government that, in its view, a number of provisions of the French legislation concerning bio-medical analysis laboratories raised problems of compatibility with the right of establishment and the freedom to provide services laid down in Articles 43 EC and 49 EC.
33. As the French authorities did not reply to that letter, the Commission sent the French Republic a reasoned opinion on 24 January 2001.
34. The French authorities replied to the reasoned opinion by letter of 6 June 2001, rejecting the Commission’s objections.
35. The Commission considered that the response was not satisfactory and, by application of 17 December 2001, commenced an action under Article 226 EC against the French Republic.
36. The Commission claims that the Court should:
(a) declare that
– by requiring bio-medical analysis laboratories established in other Member States to have their place of business on French territory as a condition for obtaining the requisite operating authorisation, and
– by precluding any reimbursement of the cost of bio-medical analyses carried out by bio-medical analysis laboratories established in another Member State,
the French Republic has failed to fulfil its obligations under Articles 43 EC and 49 EC; and
(b) order the French Republic to pay the costs.
37. The French Republic claims that the Court should:
– dismiss the entire application, and
– order the Commission to pay the costs.
IV – The first complaint, concerning the requirement to have a place of business on French territory
38. As the Commission submits that the French Republic infringes both Article 43 EC (freedom of establishment) and Article 49 EC (freedom to provide services), I shall examine the problem in the light of Article 43 EC first.
A – Breach of the principle of freedom of establishment
39. The Commission submits that the French Republic denies a laboratory which has its place of business in another Member State the opportunity to set up a secondary place of business in France in accordance with the second paragraph of Article 43 EC.
40. I have some difficulty in understanding what the Commission means by that. The Commission does not appear to claim and, in any event, does not show that French legislation prohibits a foreign laboratory from establishing a branch or subsidiary in France in which to undertake all the operations traditionally carried out by a laboratory.
41. Nor does the Commission demonstrate that this legislation prevents a laboratory established in another Member State from transferring all of its activities to France, so that the establishment situated in France would no longer be a secondary place of business, but would become the only place of business of the undertaking in question.
42. I assume, therefore, that the Commission is referring rather to the hypothesis where a foreign laboratory owns or rents premises, on French territory, in which blood samples are taken and then sent to another Member State to be analysed.
43. This hypothesis may be assessed in two different ways.
44. First, one might consider – in theory – that the activity consisting only of taking blood samples constitutes an economic activity in itself. However, that would imply that the ‘place of business’ of the ‘blood test laboratory’ in question was, by definition, in France, so that the abovementioned complaint would be irrelevant.
45. Second, it should be noted that, if taking blood samples does not in itself constitute a complete economic activity, that process would therefore constitute a phase of the wider activity of blood analysis.
46. That is obviously the case here. However, as the main part of this activity takes place abroad, in the interest of a patient resident in France, it must be concluded that it is a question of a cross-border provision of services. In other words, the taking of a blood sample in France and the analysis of that blood in a neighbouring country form part of one and the same provision of services.
47. A laboratory which only takes blood samples does not therefore constitute a secondary place of business (5) for the laboratory, but an infrastructure aimed at making it easier for the laboratory to provide its services by taking it closer to the users of its services.
48. The Court held in Gebhard (6) that ‘the fact that a provision of services is temporary does not mean that the provider of services within the meaning of the Treaty may not equip himself with some form of infrastructure in the host Member State (including an office, chambers or consulting rooms) in so far as such infrastructure is necessary for the purposes of performing the services in question’.
49. I consider therefore that the French requirement to have a place of business on French territory does not have the effect of excluding an entire economic sector from application of the principle of freedom of establishment (Article 43 EC), as the Commission claims, but that the requirement must be examined in the light of the principle of freedom to provide services (Articles 49 EC and 50 EC).
B – Breach of the principle of freedom to provide services
1. The arguments submitted to the Court
50. The Commission alleges that the French Republic denies a laboratory which has its place of business in another Member State the opportunity to respond to the requests of persons insured in France from its place of business abroad.
51. Without disputing that a Member State may lay down rules governing authorisation for operating laboratories, the Commission considers that such rules must take account of the requirements and safeguards already complied with in the Member State of establishment. Otherwise, the situation would run counter to the principle of proportionality.
52. The Commission considers that the requirement to have a place of business in France cannot be justified. To the extent that there is discrimination, Article 46(1) EC together with Article 55 EC on the freedom to provide services cannot allow application of the principles of right of establishment and freedom to provide services to be excluded from an entire economic sector such as the one at issue. (7) If the requirement must be seen as a non-discriminatory restriction, according to the Commission, all the grounds for justification invoked by the French authorities must be rejected.
53. As for the quality of medical services, the Commission points out, first, that the quality of medical services is ensured pursuant to several coordinating and mutual recognition directives concerning the qualifications of doctors, pharmacists and veterinary surgeons. Secondly, the conditions for taking up and pursuing these specialised activities fall directly within the scope of application of Articles 43 EC and 49 EC, and general systems of professional recognition of qualifications. The various directives on ‘mutual recognition’ make part of the monitoring easier to carry out, which proves that the need for controls does not constitute a sufficient reason to justify the requirement as to the location of the place of business.
54. As for monitoring, the Commission states that the requirement of a permanent establishment can only exceptionally be justified, if the authorities show that their supervisory tasks cannot otherwise be carried out. That is not the case here. The condition that the place of business must be situated on French territory would not be necessary if the foreign laboratory in question could obtain the administrative operating authorisation on condition that it agreed that all the controls necessary for the French authorities to accomplish their tasks be carried out on its premises. The purpose of the controls could be fulfilled by appropriate organisational measures, including temporary authorisation.
55. Moreover, in order that analyses carried out outside France could be assessed according to French standards, laboratories established in another Member State could agree, voluntarily, to comply with French standards when applying for authorisation.
56. The Commission explains in detail that the provisions of Directive 98/79/EC of the European Parliament and of the Council of 27 October 1998 on in vitro diagnostic medical devices (8) are a useful criterion for analysis and may be used as a benchmark for measures which are proportionate with regard to the objective pursued.
57. The Commission complains that the French Republic has not explained whether and why its own system ensures a higher level of quality assurance and why it is not possible to carry out blind controls on samples coming from laboratories established in other Member States.
58. The Commission explains in justification that the effectiveness of penalties against laboratories and the maintenance of an essential treatment facility may also be guaranteed by less restrictive means than the condition of having a place of business on French territory. The Commission notes, in respect of the maintenance of an essential treatment facility on national territory, that the French Republic has not proven, in accordance with the judgment in Kohll, (9) that a balanced medical service, open to all, could not otherwise be guaranteed.
59. The French Republic agrees that the condition of having a place of business on French territory may be classified as a barrier, but that it is justified by the overriding reason of public health, that is, the objective of the protection of public health, and is proportionate to the objective pursued.
60. The French Republic notes the absence of harmonising rules as to the operation of bio-medical analysis laboratories. It is therefore for Member States to decide the level to which they intend to ensure the protection of human health and life.
61. The French Republic points out that the directives on the mutual recognition of diplomas of doctors, pharmacists and veterinary surgeons only cover one aspect of the rules imposed on bio-medical analysis laboratories in France.
62. The French Republic states that it cannot judge the levels of control in other Member States. It is for the Commission to show that the quality criteria and monitoring procedures are equivalent to the criteria and controls in force in France. It also points out that it is not possible to compare the system for in vitro diagnostic medical devices, as laid down by Directive 98/79, and the situation of bio-medical analysis laboratories.
63. As for compliance with the principle of proportionality, the French Republic admits that its rules prevent any provision of services by laboratories in other Member States. However, it contends that, in accordance with Commission v Germany (10) and Commission v Belgium, (11) the conditions for requiring a permanent establishment on French territory are met. The Commission has not illustrated how the French authorities’ supervisory tasks could be carried out in a more proportionate manner in this field of activity in the absence of Community harmonisation or bilateral agreements. It is not possible for French inspectors to carry out controls in foreign laboratories. The other Member States cannot carry out these controls instead of the French authorities, and the French authorities a priori cannot acknowledge as equivalent the controls carried out in other Member States.
64. The French Republic describes in detail the scope and procedures of the controls carried out by its authorities and notes that they are strictly linked to the practising restrictions imposed by French legislation for the protection of public health. For certain analyses, specific methods and an interpretation of results are required. If analyses were carried out in another Member State, there would be a higher risk of a false interpretation of results, which would bring about a real risk for the patients’ health.
2. Analysis
65. It cannot be denied that the disputed provisions prevent any foreign laboratory from providing its services in France, which is not, in any case, challenged by the French Government.
66. It is also established that no directive has been adopted by the Community institutions with a view to coordinating the establishment and operating conditions for bio-medical laboratories.
67. It is clear from Article 47(3) EC that ‘[i]n the case of the medical and allied and pharmaceutical professions, the progressive abolition of restrictions shall be dependent upon coordination of the conditions for their exercise in the various Member States’.
68. Under Article 55 EC, that provision also applies as regards the provision of services.
69. To my mind, medical analysis laboratories fall within the field of paramedical professions.
70. In my Opinion of 13 December 2001 in Gräbner, (12) I argued that the abovementioned sectors were thus subjected to a condition which is not laid down for any other sphere of professional activity. For other sectors, the prohibition of restrictions on the freedom to provide services inside the Community, set out in Article 49 EC, must be considered as ‘an obligation to obtain a precise result, the fulfilment of which had to made easier by, but not made dependent on, the implementation of a programme of progressive measures. It follows that the essential requirements of Article 59 of the Treaty [now, after amendment, Article 49 EC] became directly and unconditionally applicable on the expiry of that [transitional] period’. (13)
71. However, the Court paid no attention to this argument in its judgment in Gräbner.
72. Indeed, the Court declared: (14) ‘it should be stated at the outset that consistent case-law shows that, in the absence of harmonisation of a profession, Member States remain, in principle, competent to define the exercise of that profession but must, when exercising their powers in this area, respect the basic freedoms guaranteed by the Treaty (see, in particular, Case C-58/98 Corsten [2000] ECR I-7919, paragraph 31, and Case C-108/96 Mac Quen and Others [2001] ECR I-837, paragraph 24)’. The Court added: ‘[i]n order to answer the first question, therefore, it is necessary to establish, first, whether in a situation such as that in the main proceedings the exercise of the activity of a Heilpraktiker within the meaning of the German legislation is regulated by harmonisation at Community level and, if not, to determine, secondly, whether Articles 52 and 59 of the EC Treaty, which are applicable in the present case, preclude a Member State from restricting the exercise of such an activity to qualified doctors’. (15)
73. It follows from this reasoning that, according to the interpretation of the Court, even in the medical, paramedical and veterinary fields, the directives are aimed solely at facilitating the freedom to provide services. Therefore, once the transitional period expired, the free movement of doctors would be usual practice, even without the adoption of relevant directives. I do not think that this was the view of the authors of the Treaty but I will not dwell on this point further.
74. I will therefore take the consistent case-law that the Court has developed regarding all sectors of activity and which the Court has applied also to the paramedical sector in Mac Quen and Others (16) and Gräbner, (17) as a basis for my analysis.
75. It is clear from this case-law that all measures which prohibit, impede or render less attractive the exercise of the freedom to provide services must be considered as restrictions.
76. Such measures can be justified only if they fulfil four conditions: they must be applied in a non-discriminatory manner, they must be justified by overriding reasons based on the general interest, they must be suitable for securing the attainment of the objective which they pursue and they must not go beyond what is necessary in order to attain that objective. (18)
77. It is undisputed that legislation implying that authorisation to operate a laboratory can be granted only to laboratories having a place of business in France constitutes a restriction on the exercise of the freedom to provide services. It is appropriate, therefore, to consider whether such legislation may be justified in the light of the four conditions derived from the case-law of the Court.
78. In that respect, it should be noted that, although the provision in question does not include any reference to the nationality of undertakings or persons wishing to provide services in France, it is nevertheless common ground that laboratories established in another State are hindered, by this fact alone, from providing services in France. It must therefore be considered that this is an instance of indirect discrimination.
79. Must it accordingly be concluded, since the first of the four conditions derived from the case-law of the Court is not satisfied, that the restriction in question is necessarily incompatible with Community law?
80. That is not the case. It must be remembered that the protection of public health is one of the reasons which may, under Article 46(1) EC, justify restrictions on freedom of establishment resulting from the application of provisions laying down special treatment for foreign nationals. Protection of public health is therefore, in principle, also capable of justifying measures which constitute indirect discrimination or which apply indiscriminately. (19) The provisions of this paragraph apply to the provision of services pursuant to Article 55 EC.
81. Admittedly, the choice of a Member State to reserve, to laboratories having a place of business in France, the right to carry out bio-medical analyses as regards persons residing in France, may be considered as a means of achieving the objective of protecting public health. It makes it possible to ensure not only the qualifications of the directors and personnel of those laboratories but also to monitor, by periodic inspections, that the carrying-out of analyses is always in compliance with the rules laid down by the Member State in question.
82. However, it has to be considered whether the measure in question goes beyond what is necessary to attain the objective pursued.
83. It should be borne in mind in this regard that the fact that other Member States impose possibly less strict rules than those applicable in France does not mean in itself that the latter’s rules are disproportionate and hence incompatible with Community law. (20)
84. The mere fact that a Member State has chosen a system of protection different from that adopted by another Member State cannot affect the appraisal as to the need for and proportionality of the provisions adopted. (21)
85. Although the Commission acknowledges the right of Member States to lay down rules governing the authorisation for operating laboratories, it none the less considers that the requirement to have a place of business located on French territory is not necessary to attain the objective pursued.
86. For its part, the French Government contends that the Court has already accepted that a Member State may impose a requirement of establishment if its authorities cannot carry out their supervisory tasks effectively unless the undertaking has a permanent establishment in the aforesaid State. The French Government refers in this respect, first, to the judgment in Commission v Germany, (22) concerning the insurance sector.
87. It is however apparent from this judgment that the Court adopted a more moderate position than stated by the defendant.
88. Indeed, the Court declared that, ‘if the requirement of an authorisation constitutes a restriction on the freedom to provide services, the requirement of a permanent establishment is the very negation of that freedom. It has the result of depriving Article 59 of the Treaty of all effectiveness, a provision whose very purpose is to abolish restrictions on the freedom to provide services of persons who are not established in the State in which the service is to be provided ... If such a requirement is to be accepted, it must be shown that it constitutes a condition which is indispensable for attaining the objective pursued’ (paragraph 52).
89. Next, the Court pointed out that it was for the competent authorities to show ‘that those authorities cannot, even under an authorisation procedure, carry out their supervisory tasks effectively unless the undertaking has in the aforesaid State a permanent establishment at which all the necessary documents are kept’ (end of paragraph 54). The Court however considered that this had not been proved in relation to balance sheets, accounts and commercial documents, including insurance conditions and schemes of operation. Copies of these documents could be sent from the State of establishment and duly certified by the authorities of that Member State. The Court concluded that ‘it is possible under an authorisation procedure to subject the undertaking to such conditions of supervision by means of a provision in the certificate of authorisation and to ensure compliance with those conditions, if necessary by withdrawing that certificate’ (paragraph 55).
90. The French Government also invokes the judgment in Commission v Belgium (23) in support of its point of view. I do not see, however, how this case can substantiate its argument because the Court declared in that judgment that in requiring security firms to have a place of business in Belgium, that Member State had failed to fulfil its obligations, pursuant inter alia to Article 59 of the Treaty.
91. That said, I would like once again to consider the judgment in Commission v Germany, concerning the insurance sector, which I have just mentioned, as it includes other details which can be transposed to this case.
92. As I have already pointed out, the Commission accepts that the French Republic may also apply its authorisation procedure to foreign laboratories, and I fully agree with the Commission in that respect.
93. In Commission v Germany, a procedure of this kind, called ‘authorisation’, was also called into question and the explanations which the Court gave on the subject are relevant to this case.
94. The Court stated, first of all, that ‘the German Government’s argument to the effect that only the requirement of an authorisation can provide an effective means of ensuring the supervision which ... is justified on grounds relating to the protection of the consumer both as a policy-holder and as an insured person, must be accepted. Since a system such as that proposed in the draft for a second directive, which entrusts the operation of the authorisation procedure to the Member State in which the undertaking is established, working in close cooperation with the State in which the service is provided, can be set up only by legislation, it must also be acknowledged that, in the present state of Community law, it is for the State in which the service is provided to grant and withdraw that authorisation’ (paragraph 46).
95. The Court added that it ‘should however be emphasised that the authorisation must be granted on request to any undertaking established in another Member State which meets the conditions laid down by the legislation of the State in which the service is provided, that those conditions may not duplicate equivalent statutory conditions which have already been satisfied in the State in which the undertaking is established and that the supervisory authority of the State in which the service is provided must take into account supervision and verifications which have already been carried out in the Member State of establishment’ (paragraph 47).
96. If an authorisation procedure is justified in the field of insurance, it is a fortiori justified as regards laboratories, whose possible poor operation may bring about negative consequences for the health of the persons concerned. However, such a system must also meet the conditions set out above.
97. I therefore propose that the first complaint of the Commission be upheld and that the Court declare that Articles 49 EC and 50 EC preclude making the provision of services carried out by medical analysis laboratories established in other Member States conditional on having a place of business in the State in which the service is provided, but that such services may nevertheless be subject to an authorisation procedure.
98. This means that laboratories located in other Member States cannot claim the right to exercise their activities with regard to persons resident in France merely on the basis of the fact that they meet the conditions in force in the country in which they are established.
99. For their part, the French authorities must verify whether the interests which the French authorisation procedure is intended to protect are not already safeguarded by the rules to which the service provider is subject in the Member State where he is established. (24) It is for the laboratory which wishes to obtain authorisation to supply all relevant evidence in that respect.
100. As regards controls on the premises, however, I do not share the Commission’s optimism in considering that it is sufficient that foreign laboratories themselves agree to controls carried out by French inspectors for such controls to become possible. I doubt that the governments of countries of establishment would accept such intrusions on their territory and I doubt that even the French inspectors would be prepared to carry out such ‘inspections on the premises’.
101. Furthermore, I do not think that it is possible to oblige the French Government to commence negotiations with neighbouring States with the aim of having those controls authorised or to have them carried out by the competent local authorities, in accordance with French criteria.
102. Indeed, it is for the Commission to propose a harmonising directive laying down, inter alia, the principle of monitoring by only the authorities of the country where the principal place of business is located (‘home control’) as has been done in the insurance and banking sectors. It would be unfair to require Member States to enter into negotiations with their neighbours and to set up a series of bilateral recognition procedures merely because, 45 years after the entry into force of the EEC Treaty, no harmonising directive has been adopted.
103. The solution to the problem of monitoring seems to me to be for the foreign laboratories to prove to the satisfaction of the French authorities that the controls to which they are subject are no less stringent than those in force in France.
104. It is also for those laboratories to ensure that their report of analysis results can be understood by French doctors. That especially applies to the interpretation of the results by the biologist which is, in certain instances, required by the French rules in order to assist the consultant in his diagnosis.
105. On the basis of the foregoing, I conclude, as regards the first plea, that the French Republic has failed to fulfil its obligations under Articles 49 EC and 50 EC by requiring bio-medical analysis laboratories established in other Member States to have their place of business on French territory as a condition for admission to the French authorisation procedure.
V – The second complaint, concerning refusal to reimburse the cost of bio-medical analyses carried out in another Member State
A – Arguments submitted to the Court
106. The Commission complains that the French Republic de facto precludes reimbursement of the cost of medical analyses carried out in laboratories established in another Member State. This exclusion is an indirect consequence of Article R. 332-2 of the Code de la sécurité sociale, because there are no analyses which French laboratories cannot carry out. For the Commission, this constitutes a barrier and is discriminatory.
107. The Commission rejects the French Republic’s argument that the social security rules do not have any restrictive effects on the right of establishment or the freedom to provide services, because authorisation is a necessary condition for laboratories to be linked to the State health scheme, but a laboratory which has received operating authorisation has not necessarily entered into an agreement with French social security. The Commission considers that a foreign laboratory wishing to provide services in France could do so in practice only by complying with the national agreement of 26 July 1994.
108. On the basis of paragraph 41 of the judgment in Kohll, the Commission contends that the risk of seriously undermining the financial balance of the social security system is the only reason capable of justifying a restriction to the principle of the free movement of services, but that it is not established that reimbursement of the costs of bio-medical analyses carried out in another Member State in accordance with French social security tariffs has a significant effect on the financing of the social security system. In this context, the Commission points out in particular that sickness insurance funds are authorised to refuse to reimburse additional costs resulting from the choice of a laboratory other than one located in the area where the insured person lives. If this principle is also accepted with regard to laboratories established abroad, this measure, according to the Commission, would in any event be less restrictive than the current rules.
109. The French Republic replies on the substance that the conclusion to which the Court arrived in Kohll is based on the fact that the conditions for taking up and pursuing the profession of doctor and dentist were covered by several coordinating and harmonising directives. The absence of harmonisation as regards bio-medical analysis laboratories is the decisive difference between this case as compared with Kohll.
110. In reply, the Commission notes that, although lack of harmonisation can justify an authorisation procedure for reasons relating to the protection of public health, to exclude all possibility of granting such authorisation in relation to laboratory analyses, on the basis of the criterion that the laboratory is established outside French territory, is disproportionate, because it goes beyond concerns relating to the protection of health.
111. Considering that, by this argument, the Commission is not entirely rejecting the system set up by French legislation, the French Republic requests the Court, as a subsidiary plea, to establish criteria for defining cases in which the costs of certain analyses by a laboratory can be reimbursed without prior authorisation. In that respect, a distinction might be envisaged between, on the one hand, ‘automated’ analyses, carried out in a standardised manner by machines and for which there are no specific French standards and, on the other, more technical analyses requiring particular know-how. The French Government proposes reimbursing the costs of ‘automated’ analyses on the basis of French registered tariffs. Reimbursement of the costs of more technical analyses should still be linked to compliance with French quality standards.
B – Analysis
112. This last proposal illustrates that the issue of more stringent French standards is not as large as the government’s first observations might lead one to believe.
113. It also shows that having contractual arrangements with sickness insurance funds is not really a problem. Not even all French laboratories are expressly contracted. The Commission has pointed out, without being challenged, that, unless expressly notified by the director of a laboratory that he does not wish to be placed under the scheme of the agreement, French laboratories satisfying the French conditions of the public health rules are considered to have contracted with the national sickness insurance fund and the costs of the analyses carried out are reimbursed on the basis of the tariffs fixed by the agreement. It would therefore be sufficient for the sickness insurance funds to treat bills coming from foreign laboratories in the same way. They are, of course, entitled to refuse to reimburse additional costs resulting from the choice of a laboratory other than one located in the area where the insured person lives.
114. As for analysis of the second complaint, it is enough to note that failure, by the French sickness insurance funds, to reimburse bills coming from a laboratory established in another Member State constitutes a restriction which cannot be justified unless the four abovementioned conditions are met.
115. In this respect, the same reasoning as that followed in the context of the first complaint raised by the Commission should be applied. It follows that the restriction can be justified only in so far as the laboratory in question has not obtained an authorisation as I advised in my review of that complaint.
116. Since, at present, no such authorisation can be obtained whatsoever, the second of the Commission’s pleas should be upheld.
117. I should add that, when the French authorisation system is opened up to laboratories established in other Member States, that cannot seriously undermine the financial balance of the French social security scheme. The services of those laboratories would be reimbursed only within the limits provided for by the abovementioned agreement.
118. Moreover, the ground based on a rise in the number of analyses is not convincing either, given that analyses are prescribed by French doctors who are bound, in any event, to prescribe only those analyses which are strictly necessary.
119. I can therefore conclude, as regards the second complaint, that the French Republic has failed to fulfil its obligations under Articles 49 EC and 50 EC by precluding any reimbursement of the cost of bio-medical analyses carried out by laboratories established in another Member State.
VI – Conclusion
120. I therefore propose that the Court should:
(1) declare that the French Republic has failed to fulfil its obligations under Articles 49 EC and 50 EC,
– by requiring bio-medical analysis laboratories established in other Member States to have their place of business on French territory as a condition for admission to the French authorisation procedure,
– and by precluding any reimbursement of the cost of bio-medical analyses carried out by laboratories established in another Member State;
(2) order the French Republic to pay the costs.