FOR small European states, language policy calls for a delicate balancing act. Luxembourg has three official languages, Switzerland four, and Belgium three. In Luxembourg, the distinction is mostly functional: different languages for different social spheres. In Switzerland and Belgium, languages are instead spread geographically. This geographic spread seems to simplify matters on paper, creating clear lines between language communities. Belgium’s constitution, for example, divides the country into four linguistic regions: the Dutch-speaking north (Flanders, or the Flemish Region), the French-speaking south (Wallonia), the small German-speaking regions in the east, and the bilingual (Dutch-French) capital, Brussels. But with the country divided roughly in half between Flanders and Wallonia, laws and policies become proxies for deeper cultural tensions. The standoff between the Dutch- and French-speaking communities was particularly tense after the 2010 elections, when it took over 500 days to form a government.

In part because of this longstanding division, some Flemish and Wallonian laws are fiercely protective of Dutch and French. But the European Court of Justice (ECJ) thinks at least one of those laws has unacceptable consequences. Flemish law had previously considered only Dutch-language contracts authentic. Contracts in other languages would be nullified. Anton Las, from the Netherlands, had been contracted to be chief financial officer of PSA Antwerp, a Belgian subsidiary of a Singaporean port operator. His contract was in English. Unfortunately for Mr Las, his contract was nullified under the Dutch-only law, and he was booted from the company. Denied a job, he sued. A Belgian court, unsure of how to answer, asked the ECJ to make a preliminary ruling on that section of Flemish law. On Tuesday, the ECJ decided that the policy violated EU law.

The ECJ agreed that preserving and promoting a country’s language is important. But the laws must be proportionate to the need. Because EU law protects workers' freedom of movement, restrictions on that freedom must be carefully crafted. The court worried that a Dutch-only law would dissuade people from moving to Flanders and taking up work.

[T]he objective of promoting and encouraging the use of Dutch, which is one of the official languages of the Kingdom of Belgium, constitutes a legitimate interest which, in principle, justifies a restriction on the obligations imposed by Article 45 TFEU [the EU law covering freedom of movement for workers]. ... [But] in order to satisfy the requirements laid down by European Union law, legislation ... must be proportionate to those objectives.

The court recommended allowing foreign transactors to use a mutually intelligible language:

[P]arties to a cross-border employment contract do not necessarily have knowledge of [Dutch]. In such a situation, the establishment of free and informed consent between the parties requires those parties to be able to draft their contract in a language other than [Dutch].

The ECJ’s preliminary rulings are binding, so the Flemish government will have to rejigger its policies. The law in question here was written with no flexibility at all, suggesting that it served linguistic nationalism more than genuine need. Belgium has outsized language worries for its size, so it will be curious to see how Flemish businesses react to new rules. I suspect that more flexibility will revitalise, not doom, business there.