Article 15 - Freedom to choose an occupation and right to engage in work
Article 16 - Freedom to conduct a business
Article 47 - Right to an effective remedy and to a fair trial
Article 48 - Presumption of innocence and right of defence
Article 52 - Scope and interpretation
Key facts of the case:
This request for a preliminary ruling concerns the interpretation of Article 15(2) and Articles 41, 47 and 52 of the Charter of Fundamental Rights of the European Union (‘the Charter’).
The request has been made in proceedings between PI and the Landespolizeidirektion Tirol (State Police Department of Tyrol, Austria; ‘the State Police Department’) concerning the lawfulness of the closure of a commercial establishment managed by PI.
Outcome of the case:
On those grounds, the Court (Sixth Chamber) hereby rules:
Article 49 TFEU, Article 15(2) and Articles 16, 47 and 52 of the Charter of Fundamental Rights of the European Union and the general principle of the right to good administration must be interpreted, in circumstances such as those at issue in the main proceedings, as precluding national legislation providing that an administrative authority may decide to close a commercial establishment with immediate effect, on the ground that it suspects that prostitution is practised in that establishment without the authorisation required under that legislation, in so far as that legislation, first, does not require reasons, in fact and in law, to be given in writing for such a decision and to be communicated to its addressee, and second, requires that any application brought by that addressee and seeking annulment of that decision must be reasoned.
1 This request for a preliminary ruling concerns the interpretation of Article 15(2) and Articles 41, 47 and 52 of the Charter of Fundamental Rights of the European Union (‘the Charter’).
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3) Article 15 of the Charter, entitled ‘Freedom to choose an occupation and right to engage in work’, provides:
‘1. Everyone has the right to engage in work and to pursue a freely chosen or accepted occupation.
2. Every citizen of the Union has the freedom to seek employment, to work, to exercise the right of establishment and to provide services in any Member State.
…’
4) The explanations relating to the Charter (OJ 2007 C 303, p. 17) state, as regards Article 15(2) thereof, that that provision deals with the three freedoms guaranteed by Articles 26, 45, 49 and 56 TFEU, namely freedom of movement for workers, freedom of establishment and freedom to provide services.
5) Article 16 of the Charter, entitled ‘Freedom to conduct a business’, is worded as follows: ‘The freedom to conduct a business in accordance with Union law and national laws and practices is recognised.’
6) The explanations relating to the Charter state, as regards Article 16 thereof, that that provision is based on Court of Justice case-law which has recognised freedom to exercise an economic or commercial activity and freedom of contract, and on Article 119(1) and (3) TFEU, which recognises free competition.
7) Article 35 of the Charter, entitled ‘Health care’, provides; ‘Everyone has the right of access to preventive health care and the right to benefit from medical treatment under the conditions established by national laws and practices. ...’
8) Article 41 of the Charter, entitled ‘Right to good administration’, states:
‘1. Every person has the right to have his or her affairs handled impartially, fairly and within a reasonable time by the institutions, bodies, offices and agencies of the Union.
2. This right includes:
(a) the right of every person to be heard, before any individual measure which would affect him or her adversely is taken;
(b) the right of every person to have access to his or her file, while respecting the legitimate interests of confidentiality and of professional and business secrecy;
(c) the obligation of the administration to give reasons for its decisions. …’
9) Article 47 of the Charter, entitled ‘Right to an effective remedy and to a fair trial’, reads as follows:
‘Everyone whose rights and freedoms guaranteed by the law of the Union are violated has the right to an effective remedy before a tribunal in compliance with the conditions laid down in this Article.
Everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal previously established by law. Everyone shall have the possibility of being advised, defended and represented.
10) Article 48 of the Charter, entitled ‘Presumption of innocence and right of defence’, states in paragraph 2:
‘Respect for the rights of the defence of anyone who has been charged shall be guaranteed.’
11) Article 51 of the Charter, entitled ‘Field of application’, provides in paragraph 1:
‘The provisions of this Charter are addressed to the institutions, bodies, offices and agencies of the Union with due regard for the principle of subsidiarity and to the Member States only when they are implementing Union law. ...’
12) Article 52 of the Charter, entitled ‘Scope and interpretation of rights and principles’, provides:
‘1. Any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the European Union or the need to protect the rights and freedoms of others.
2. Rights recognised by this Charter for which provision is made in the Treaties shall be exercised under the conditions and within the limits defined by those Treaties.
…
7. The explanations drawn up as a way of providing guidance in the interpretation of this Charter shall be given due regard by the courts of the Union and of the Member States.’
36) In those circumstances, the Landesverwaltungsgericht Tirol (Regional Administrative Court, Tyrol) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
‘(1) Is Article 15(2) of the [Charter] to be understood as precluding legislation of a Member State which, as in the case of Paragraph 19[a](3) [of the Police Law], makes it possible for bodies of an authority, even without a prior administrative procedure, to be able to take measures of direct authority and coercive power, such as, in particular, the on-the-spot closure of a business establishment, without these merely being interim measures?
(2) From the perspective of equality of arms and the perspective of an effective legal remedy, is Article 47 of the Charter, potentially in conjunction with Articles 41 and 52 thereof, to be understood as precluding legislation of a Member State which, as laid down in Paragraph 19[a](3) and (4) [of the Police Law], provides for de facto measures of direct authority and coercive power, such as, in particular, closures of business establishments, without documentation and without providing confirmation to the person concerned?
(3) From the perspective of equality of arms, is Article 47 of the Charter, potentially in conjunction with Articles 41 and 52 thereof, to be understood as precluding legislation of a Member State which, for the purpose of annulling de facto measures of direct authority and coercive power, such as, in particular, closures of business establishments, requires a substantiated application to lift that closure from the person affected by those de facto measures, as laid down in Paragraph 19[a](3) and (4) [of the Police Law]?
(4) From the perspective of an effective legal remedy, is Article 47 of the Charter, in conjunction with Article 52 thereof, to be understood as precluding legislation of a Member State which, as in the case of Paragraph 19[a](4) [of the Police Law], allows only for a right to apply for annulment that is restricted to specific conditions in the case of a de facto coercive measure in the form of the closure of a business establishment?’
43) In the present case, even if, formally, the referring court has limited its questions to the interpretation of Article 15(2) and Articles 41, 47 and 52 of the Charter, that does not prevent this Court from providing the referring court with all the elements of interpretation of EU law that may be of assistance in adjudicating in the case pending before it, whether or not the referring court has referred to them in the wording of its questions. It is, in that regard, for the Court to extract from all the information provided by the national court, in particular from the grounds of the decision referring the questions, the points of EU law which require interpretation in view of the subject matter of the dispute in the main proceedings (see, to that effect, judgment of 19 December 2018, AREX CZ, C‑414/17, EU:C:2018:1027, paragraph 35 and the case-law cited).
52) Article 15(2) of the Charter, which is referred to in the first question, recognises the freedom of every citizen of the Union to exercise the right of establishment and to provide services in any Member State.
53) It is clear from the explanations relating to the Charter, which, in accordance with the third subparagraph of Article 6(1) TEU and Article 52(7) of the Charter, must be taken into consideration for the purpose of interpreting it, that Article 15(2) of the Charter deals with the three freedoms guaranteed by Articles 26, 45, 49 and 56 TFEU, namely, the free movement of workers, freedom of establishment and freedom to provide services.
54) In that regard, it should be noted that even though the referring court does not make reference, in its request for a preliminary ruling, to Article 16 of the Charter, it is clear from the case-law of the Court that that provision refers, inter alia, to Article 49 TFEU, which guarantees the fundamental freedom of establishment (see, to that effect, judgment of 13 February 2014, Sokoll-Seebacher, C‑367/12, EU:C:2014:68, paragraph 22).
55) Consequently, making reference, with regard to the freedom of establishment, to Article 15(2) of the Charter, necessarily requires, in the context of the main proceedings, an assessment of compliance with that freedom in the light of Article 16 of the Charter.
56) As regards Article 41 of the Charter, which is referred to in the second and third questions, it must be observed that it is clear from the wording of that provision that it is addressed not to the Member States but solely to the institutions, bodies, offices and agencies of the European Union (judgment of 13 September 2018, UBS Europe and Others, C‑358/16, EU:C:2018:715, paragraph 28 and the case-law cited). It follows that Article 41 of the Charter is irrelevant to the case in the main proceedings.
58) Therefore, it follows from the foregoing considerations that, by its questions, which it is appropriate to examine together, the referring court asks, in essence, whether Article 49 TFEU, Article 15(2) and Articles 16, 47 and 52 of the Charter and the general principle of the right to good administration must be interpreted, in circumstances such as those at issue in the main proceedings, as precluding national legislation providing that an administrative authority may decide to close a commercial establishment with immediate effect, on the ground that it suspects that prostitution is practised in that establishment without the authorisation required under that national legislation, in so far as that legislation, in the first place, does not require reasons, in fact and in law, to be given in writing for such a decision and to be communicated to its addressee, in the second place, requires that any application brought by that addressee and seeking annulment of that decision must be reasoned and, in the third place, limits the grounds on which the competent administrative body may annul that decision.
63) It is also settled case-law that the fundamental rights guaranteed by the Charter are applicable in all situations governed by EU law and that they must, therefore, in particular be complied with where national legislation falls within the scope of EU law (judgment of 21 December 2016, AGET Iraklis, C‑201/15, EU:C:2016:972, paragraph 62 and the case-law cited).
65) In the present case, in so far as the national legislation at issue in the main proceedings constitutes, as is apparent from paragraph 61 of the present judgment, a restriction on the freedom of establishment for the purposes of Article 49 TFEU, it also entails a limitation on the exercise of the freedom of establishment and the freedom to conduct a business, respectively enshrined in Article 15(2) and Article 16 of the Charter.
66) At the same time, Article 52(1) of the Charter accepts that limitations may be imposed on the exercise of rights enshrined by the Charter as long as the limitations are provided for by law, respect the essence of those rights and freedoms and, in accordance with the principle of proportionality, are necessary and genuinely meet objectives of general interest recognised by the European Union or the need to protect the rights and freedoms of others (judgment of 21 December 2016, AGET Iraklis, C‑201/15, EU:C:2016:972, paragraph 70 and the case-law cited).
72) The protection of health is also guaranteed by Article 35 of the Charter, which provides that everyone has the right of access to preventive healthcare and the right to benefit from medical treatment under the conditions established by national laws and practices.
78) It follows from the case-law of the Court that the effectiveness of the judicial review guaranteed by Article 47 of the Charter also requires that the person concerned be able to ascertain the reasons upon which the decision taken by an administrative authority in relation to him is based, either by reading the decision itself or by communication of those reasons on its request, without prejudice to the power of the court having jurisdiction to require the authority concerned to communicate them so as to enable him to defend his rights in the best possible conditions and to decide in full knowledge of the circumstances whether it is worthwhile applying to the court having jurisdiction, and in order to put the latter fully in a position to carry out the review of the lawfulness of the national decision in question (judgments of 4 June 2013, ZZ, C‑300/11, EU:C:2013:363, paragraph 53, and of 16 May 2017, Berlioz Investment Fund, C‑682/15, EU:C:2017:373, paragraph 84).
79) Moreover, the right to be heard in all proceedings, which is affirmed by Articles 47 and 48 of the Charter and which forms an integral part of respect for the rights of the defence, which is a general principle of EU law, requires the authorities to pay due attention to the observations submitted by the person concerned, examining carefully and impartially all the relevant aspects of the individual case and giving a detailed statement of reasons for their decision; the obligation to state reasons for a decision are sufficiently specific and concrete to allow the person concerned to understand the reasons for the refusal of his request is thus a corollary of the principle of respect for the rights of the defence (see, to that effect, judgment of 5 November 2014, Mukarubega, C‑166/13, EU:C:2014:2336, paragraphs 43, 45 and 48).
81) The requirement that the national administrative authorities state reasons is particularly important in a case such as that in the main proceedings, in which it must be determined whether a restriction of the freedom of establishment within the meaning of Article 49 TFEU and the rights of establishment and to conduct a business, enshrined in Article 15(2) and Article 16 of the Charter respectively, is justified and proportionate.
85) Indeed, that legislation does not ensure that the addressee of that decision can ascertain the reasons upon which it is based, to enable him to defend his rights and to decide whether it is appropriate to refer the matter to the competent court. Accordingly, in the present case, that legislation does not make it possible to ensure the effectiveness of the judicial review or the respect for the rights of the defence, guaranteed by Articles 47 and 48 of the Charter and the general principles of EU law.
91) It therefore follows from the foregoing considerations that the answer to the questions referred is that Article 49 TFEU, Article 15(2) and Articles 16, 47 and 52 of the Charter and the general principle of the right to good administration must be interpreted, in circumstances such as those at issue in the main proceedings, as precluding national legislation providing that an administrative authority may decide to close a commercial establishment with immediate effect, on the ground that it suspects that prostitution is practised in that establishment without the authorisation required under that legislation, in so far as that legislation, first, does not require reasons, in fact and in law, to be given in writing for such a decision and to be communicated to its addressee, and second, requires that any application brought by that addressee and seeking annulment of that decision must be reasoned.
92) Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
