The Luxembourg court has ruled that unemployed EU migrants can be barred from claiming unemployment benefit, even if they are actively seeking employment.
The judgment builds on last year's ruling against Elisabeta Dano, a 25-year-old Romanian woman, who, according to her case file, claimed benefits despite making no effort to obtain a job in Germany.
The 'Dano' judgment gave member states the right to refuse benefits to economically inactive migrants who "exercise their right to freedom of movement solely in order to obtain another member state’s social assistance."
The move comes as several countries across Europe are looking at clamping down on so-called "benefit tourism".
British MEP Anthea McIntyre, a member of the Parliament's employment and social affairs committee, welcomed the ruling highlighting the role it will play in preventing the abuse of welfare systems and in the ongoing EU-UK Brexit negotiations.
She said, "this is a major endorsement of our stance on benefit tourism and our views on free movement. Increasingly the rest of Europe is seeing things our way. It bodes well for one of our key areas of renegotiation…There is a clear view that freedom of movement to work is not the same a freedom to claim benefits."
She continued, "we have no problem with people coming to Britain to work and contribute to society. But people do not want to see our welfare system abused."
Her fellow British MEP, Catherine Bearder, of Parliament's Alliance of Liberals and Democrats group, also offered support for the ruling, saying, "this judgement has huge implications for the current EU debate in the UK. It confirms that jobseekers from elsewhere in the EU are not automatically entitled to claim benefits."
"I hope the myth of benefit tourism will now be put firmly to bed so we can focus instead on the many real and significant challenges facing the EU."
The case was brought to the European Court of Justice by a Swedish national, Nazifa Alimanovic, against Jobcenter Berlin Neukölln, who refused to pay Alimanovic benefits as they took the view that as a foreign national living in Germany for economic reasons, she was not entitled to benefits.
The ruling states, "where an EU citizen has not yet worked in the host member state or where the period of six months has elapsed, a job-seeker cannot be expelled from that member state for as long as he can provide evidence that he is continuing to seek employment and that he has a genuine chance of being engaged. However, in this case the host member state may refuse to grant any social assistance."
While the new ruling restricts the ease with which migrants can access benefits, it does contravene UK Prime Minister, David Cameron's demand to limit the time migrants can spend looking for work in a country.
Last year, Cameron said, "if an EU jobseeker has not found work within six months, they will be required to leave."
Cameron has pledged to go further in his benefit reform, attempting to bar EU migrant workers from access to benefits for four years.
However, these plans have been criticised by several European leaders, including the Belgian Prime Minister, Charles Michel, as they contravene the principle of non-discrimination and equal rights for EU citizens.