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Freedom to provide services

Every EU citizen and every legal person established in the European Union is entitled to provide or make use of services in another EU Member State ("freedom to provide services").

According to EU law, services are considered "services" if they are provided for remuneration and are not governed by provisions relating to freedom of movement for goods, capital and persons.

In order to qualify as a service within the meaning of the provisions on freedom to provide services, said service must be:

Services include, in particular:

  • activities of an industrial character (e.g. real estate agent);
  • activities of a commercial character (e.g. freelance sales representative);
  • activities of craftsmen (e.g. fitter);
  • activities of the professions (e.g. tax adviser).

Moreover, the legal requirements under commercial and labour law in the EU/EEA country in which cross-border services are to be provided must also be observed.

The freedom to provide services also includes the right of businesses to provide a service in another EU/EEA country using its own staff. If an employee performs work on a particular project in a different country for a limited period of time, they are deemed to be a posted worker. Special rules apply to the posting of workers in EU/EEA countries German text.

The tools and machinery belonging to a business owner that are required in order to provide a cross-border service may be moved freely, like all goods within the EU.

The principle of freedom to provide services entitles economic operators who are already authorised to carry out business activities in one EU Member State to temporarily provide their services in another EU Member State without having to become established there.

Please note

Under EU law, business owners within the European Union also have a right of establishment and a right to carry out business activities in another EU Member State.

The freedom to provide services is enshrined in the Treaty establishing the European Community. This means that the national legislation of the individual EU Member States may not in principle restrict the freedom to provide services within the European Union.

This "prohibition of restriction" stipulates that it is not permitted to restrict the movement of services within the European Union for citizens of EU Member States, without exception. Access to the single market may not be impeded by national regulations.

If there are restrictions, they must apply to all. Such restrictions are only permitted under certain conditions, for example in the case of a risk to law and order and security. These restrictions must be reasonable, i.e. proportionate..

Moreover, a "prohibition of discrimination" also applies within the EU for service providers from another country, who may not be discriminated against based on their nationality. This means that Member States may not adopt legal provisions leading to either covert or overt discrimination.

Caution

These provisions are enshrined in the EU founding treaty. However, there are still numerous national rules that restrict or impede the provision of cross-border services. Such barriers have now been removed in Austria thanks to the federal Services Act (Dienstleistungsgesetz) and the relevant acts in the federal provinces.

Further links

Legal basis

Translated by the European Commission
last update: 18 January 2021

responsible for content: Federal Ministry for Digital and Economic Affairs

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