Mr. Pusa a Finnish national exercised his free movement right after retirement and moved to Spain. As he had debts in Finland, the Finnish collector seized part of his Finnish old age pension. However, as Pusa was a resident of Spain, the pension was subject to tax in Spain. Pusa considered that as a Spanish resident he was prevented from enjoying the freedom guaranteed by the EC Treaty because the collector could only take into account Finnish withholding tax on the pension, and not the Spanish income tax that Pusa had to pay.

The ECJ ruled that, as an EU citizen, Pusa was allowed to free movement within the Member States without being discriminated.

This is the first case in which the ECJ has ruled in a tax-related case that EU citizenship and the free movement right within the Member States grants an individual the protection of the EC Treaty.

The ECJ also ruled that the Finnish regulations are not in conformity with EU legislation, as they do not take into consideration the tax paid or payable in another EU Member State.

Text of the ECJ judgment
Text of the AG opinion

The ECJ also rejected the alleged breach of Article 18 EC Treaty (free movement and residence rights), thereby reasoning that the EC Treaty does not offer a guarantee to citizens that a transfer of activities to another Member State is neutral in respect of taxation.

The conclusion of this case is simple: the disadvantage experienced by the taxpayer because he has exercised his free movement right, and thus he is subjected to a more disadvantageous tax system, is not a prohibited restriction.

Text of the ECJ judgment
Text of the AG opinion

The claimant in this case, was a Belgian national who had declared that he was unemployed and living in Belgium. When it was discovered during a routine inquiry by inspectors that he was in fact resident in France, the benefit was stopped and a demand was made for repayment of benefit already paid, on the basis of the Belgian Law whereby eligibility for unemployment benefit was conditional on actual residence in Belgium.

The ECJ pointed out first of all that the right of residence of EU citizens is not unconditional, but is conferred subject to the limitations and conditions laid down by the Treaty and by the measures adopted to give it effect.

Then, the ECJ found that the Belgian legislation places certain Belgian nationals at a disadvantage simply because they have exercised their freedom of movement and residence, and is thus a restriction on the freedoms conferred by Article 18 EC Treaty. It accepted, however, that the restriction was justified by objective considerations of public interest independent of the nationality of the persons concerned. Accordingly, a residence clause such as that applied in the case was not precluded by article 18 EC Treaty.

Text of the ECJ judgment
Text of the AG opinion

In this case, Mr Eman and Mr Sevinger, Netherlands citizens residing in Aruba, requested in 2004 that their names be entered in the electoral register in order to enable them to take part in the elections for the European Parliament. Their request was turned down on the ground that the Netherlands electoral law conferred the right to vote in the Netherlands and in elections to the European Parliament, only to Netherlands citizens who are de facto resident in the European territory of the Kingdom.

Pursuant to this, the ECJ was asked by the Netherlands Council of State whether a Member State can exclude from the right to vote in European elections a number of categories of its own citizens, resident in an overseas territory which is associated with the Community, more precisely the Aruba citizens.

The ECJ answer was that the EC Treaty did not define who was entitled to the right to vote and to stand as a candidate for the European Parliament and that therefore it was for the Member States to define this. However, the ECJ added that the principle of non discrimination enshrined in Article 12 EC Treaty must be taken into account.

Text of the ECJ judgment
Text of the AG opinion

They both challenged the refusal before the Dutch courts on the ground that the condition of residence in the Netherlands at the time of the applications is contrary to the Treaty provisions on EU citizenship. The Dutch court then referred to the ECJ with the following question: Is the Dutch residence requirement acceptable under EC law?

The ECJ held that the Dutch residence requirement was contrary to EC law. It held also that national legislation which places at a disadvantage certain of the nationals of the Member State concerned simply because they have exercised their freedom to move and to reside in another Member State is a restriction on the freedoms conferred by Article 18(1) EC Treaty on every citizen of the European Union.

Text of the ECJ judgment
Text of the AG opinion