European Union Law: Free Movement of Capital

EU solidarity

The broad concept of EU solidarity is said to be the underlying aspiration of the integration of the people of Europe and is guaranteed by the following freedoms:

Central to the European Union is the concept of unification of nations with the emphasis representing recognition of the autonomy of individual states.

Free Movement of Capital and the Internal Market

Articles 56 – 60 EC Treaty

Articles 56 to 60 of the EC Treaty guarantee the fundamental freedom of the European Union in relation to free movement of capital. In particular Article 56 states the following:

“all restrictions on the movement of capital between Member States shall be prohibited”.

In order for the European Union Internal Market to be guaranteed it is essential that capital is able to be moved freely from European Union Member State to European Union Member State.  Free movement of capital is one of the key ingredients of the Single Market or the Internal Market as it enables integrated, open, competitive and efficient European financial markets and services.

Benefits of free movement of Capital

The free movement of capital has benefits for all of us both in an individual capacity but also for business which will then have a knock on effect for consumers.

European Citizens

Citizens are thus provided with the ability to do many operations abroad for example opening bank accounts, buying shares in non-domestic companies, investing where the best return is and even going as far as purchasing property.

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For more information on:

  • European Companies
  • Are there any exceptions to the free movement of capital?