V had a ship flagged as a Finnish one and paid its staff in accordance with a collective agreement with the Finnish union (FSU). It later decided to reflag as an Estonian ship and engage the workers on terms to be agreed with the Estonian union, which would mean lower pay. FSU together with affiliated unions said they would start industrial action to prevent the reflagging, which prevented V from coming to terms with the Estonian union. V asked the court for an injunction to prevent the industrial action as it inhibited V’s right of establishment under article 43. British court issuing the injunction referred question scope and defences to article 43 to the ECJ. ECJ held that collective action which sough to induce a company to collective bargaining so as to deter it from exercising freedom of establishment was covered by article 43, and that on these facts it was a restriction. Whether or not it could be justified under, article 46, would depend on there being some overriding public concern like the protection of workers, provided that it is established that the restriction is suitable for ensuring the attainment of the legitimate objective pursued and does not go beyond what is necessary to achieve that objective.
ECJ: “It is apparent from the case-law of the Court that a restriction on freedom of establishment can be accepted only if it pursues a legitimate aim compatible with the Treaty and is justified by overriding reasons of public interest.” Even then proportionality has to be demonstrated. NB The right to strike “must therefore be recognised as a fundamental right which forms an integral part of the general principles of Community law the observance of which the Court ensures”- hence the need to balance with free movement articles.