The Economic Character of Education : The Swedish Primary Education System and the Freedom of Establishment

Sammanfattning: The education systems of the EU Member States have, following the principles of thecase Humbel, long been considered non-economic in character, and thus excepted frominternal market law. But since Humbel, the CJEU has increasingly applied the freemovement provisions, including the freedom of establishment, on public welfare. Thisalso on educational activities, when these have been economic in character, which posesa challenge the Humbel principles. Moreover, in Sweden, one of the most debated issuesis the economic character of the education system, especially the existence of private forprofit education providers. A reform of the education system aimed at the private schools,which is to be expected, would then have to comply with the freedom of establishment,if the private schools perform economic activities. In this light, this thesis studies the position of education under the freedom of establishment, to examine generally when aneducational activity is considered economic in character, and specifically if the Swedish education system entails economic activities.The thesis finds that the Humbel principles still stand but have seen their scope ofapplication reduced through the case-law of the CJEU. Tracing the development ofeducational activities in the free movement case-law from the 1980s to present-day, thethesis proposes a reformulation of the Humbel principles as two cumulative criteria basedon funding and purpose: educational activities which are funded from the public budgetand carry out the State’s task in the educational field, are not economic in character, andthus excepted from the freedom of establishment. These criteria are then applied to privateprimary schools of the Swedish education system. The result from this is that the privateprimary schools perform economic activities under the freedom of establishment. Thethesis accordingly concludes that the freedom of establishment is applicable to theSwedish education system, forcing a possible education reform to comply with saidfreedom. It is remarked that the freedom of establishment will not necessarily hinder aneducation reform, but that reform proposals will have to be tailored in a way which iscompatible with the requirements of the freedom of establishment. Finally, the thesisacknowledges that also other educational activities than those at the centre of this studyrisk falling under internal market law.