91997E2507

WRITTEN QUESTION E-2507/97 by Frédéric Striby (I-EDN) to the Commission (22 July 1997)

Subject: Difficulties encountered by French building firms in Germany

The new requirements to be met by European (in this instance, French) craft firms in the building sector since 1 January 1997 when carrying out work in Germany pose problems in connection with the freedom to provide services.

This new federal law of 26 February 1996 requires employers to pay employees working in Germany not the contractual wage of the country of origin but one based on a set minimum hourly wage (DM 17).

According to the Alsace Chamber of Trade, the payment of this minimum wage of DM 17 by a French form would represent a 27% increase in the French wage compared to the German reference wage.

Does the Commission not see this as a disguised protectionist measure and an obstacle to the free exercise of their trade by craft firms in countries bordering Germany, with due regard for the rules of the single market?

Answer given by Mr Monti on behalf of the Commission (18 September 1997)

The requirement that service providers, irrespective of their Member State of establishment, must pay a minimum wage does not infringe the freedom to provide services.

The case law of the Court of Justice has consistently shown that Articles 59 and 60 of the EC Treaty do not prevent Germany, as a host Member State, from requiring all those performing paid work on its territory, even temporarily, to comply with minimum wage rules or from ensuring compliance by appropriate means.

This principle has recently been confirmed by Directive 96/71/EC of 16 December 1996 concerning the posting of workers in the framework of the provision of services ((OJ L 18, 21.1.1997. )). The Directive requires any firm providing cross-border services on the territory of another Member State and posting workers for that purpose to comply with a number of essential minimum rules - particularly those covering the minimum wage - in force in the host Member State where the services are provided.

The new German law is therefore in accordance with Community law, provided that the checks carried out to ensure compliance with minimum wage rules are not discriminatory or disproportionate.