Brussels, 02/10/2009 (Agence Europe) - The restrictions placed on Dutch social housing associations, particularly regarding real estate investments in other member states, constitute an obstacle to the free movement of capital which can be justified only under certain conditions, according to a ruling returned by the Court of Justice on Thursday 1 October. In this specific case, the Court is not convinced that the necessary conditions have been met: it is therefore calling the Dutch courts properly to verify the national legislation in question (case 567/07).
The Court is responding to the preliminary questions put to it by the Raad van State (Council of State, Netherlands), before which the matter had been brought by the Dutch association Woningstichting Sint Servatius, a body accredited by the Dutch State to promote social housing. This association had been refused authorisation to build housing in the city of Liège in Belgium, 30 km from the Dutch border, which it hoped to pay for using the favourable borrowing conditions it enjoys in the Netherlands. According to the housing minister ("Minister voor Wonen, Wijken en Integratie"), who refused to authorise the project despite the investment already made, the Dutch system is not designed to fund real estate investments in other member states, as its sole objective is to facilitate social housing in the Netherlands.
In its ruling, the Court criticises the rules in question, not due to its final effects but over its procedures. It is true that the restriction quoted by the minister represents an undeniable obstacle to the free movement of capital: but this may be justified in the framework of a public service, as provided for by article 58 of the Treaty. In this case, the provisions would have to be proportionate to the objective, applied in a non-discriminatory fashion and using clear procedures and predictable criteria, otherwise the bodies in question would have no way of knowing whether or not their projects were likely to be accepted. In this case, the Court takes the view that "the provisions of the Housing Law (...) at issue in the main proceedings do not fully satisfy those requirements". The case has been sent back before the Raad van State, which must now make a decision in this case and on the national legislation involved, in light of the observations of the European Court. (C.D./transl.fl)