Abstract

This chapter examines the progressive nature of liberalization of the free movement of capital supported by reference to the relevant treaty provisions, secondary legislation, and case law of the Court of Justice of the European Union (CJEU). The free movement of capital is closely associated with the single currency of the European Union, the euro; consequently, the chapter will also briefly examine the current reform measures introduced for its effective management. The rules on the free movement of capital were set out in Articles 67 to 73 European Economic Community (EEC) with the aim of facilitating the liberalization of the capital movements between the member states. The change of the legal foundation of the free movement of capital after the Maastricht Treaty has created some degree of uncertainty over the legal status of Capital Directive 88/361/EEC as it owes its existence to the repealed Article 67 EEC.