Claims of outstanding balance

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We have been asked to advise Xana on the likelihood of her being able to bring a successful claim against Yvette under EC law to recover the outstanding balance of her account; namely, that proportion of the total fees payable required, under the Free Movement of Services Act 2008, as a contribution towards the quality audit which Xana is required to undergo in accordance with the provisions of that same Act. Central to this problem question is the Law of the European Union pertaining to the freedom to provide and receive services and also the freedom of establishment In order to provide a reasoned argument in response to this question it will be necessary to examine the provisions of Council Directive 2006/123/EC, which the Free Movement of Services Act 2008 purports to implement; Articles 43 to 55 of the Treaty of the European Union (1992), which provide (inter alia) the core governing principles on which restrictions to aforementioned freedoms are permissible under EC Law; and, the case law of the European Court of Justice, the decisions from which provide insight into how these principles are likely to be interpreted and applied, in order to determine whether or not:

  1. The tutorial services supplied to Yvette by Xana, on a distance-learning basis, are likely to be considered ‘services’ for the purposes of Articles 43 to 55 of the Treaty of the European Union and Council Directive 2006/123/EC;
  2. The ‘quality audit’ restriction imposed on Xana by the Free Movement of Services Act 2008 is permissible under European law; and,
  3. The ‘contribution requirement’ imposed on Yvette by the Free Movement of Services Act 2008 is valid, taking into account the overriding objectives of Articles 43 to 55 of the Treaty of the European Union and Council Directive 2006/123/EC.

In regard to whether or not the tutorial services supplied to Yvette by Xana, on a distance-learning basis, are likely to be considered ‘services’ for the purposes of Articles 43 to 55 of the Treaty of the European Union and Council Directive 2006/123/EC: For the purpose of the freedom to provide and receive services across the European Union, a ‘service’ is defined by Article 50 EC, which states: “Services shall be considered to be ‘services’ within the meaning of this Treaty where they are normally provided for remuneration, insofar as they are not governed by the provisions relating to freedom of movement for goods, capital and persons.[1]” While it has been held by the European Court of Justice, in the case of Belgium v. Humbel[2], that the provision of education by the State does not fall within the scope of this definition, even where students are required to pay fees towards the operational costs of the institutions providing their education; in the present case, because the services provided by Xena are fully commercial and independent from the duties of the United Kingdom to provide subsidized education to its citizens,

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