EU LAW economic integration & free movement of goods

Total Flash Cards » 84
 
1. 

Schul 1982

 

Gave the purpose of the internal market:
'the elimination of all obstacles to intra comm trade...merge the national markets into single market...'

 
2. 

Commission v Italy (Italian Art Case) 1968

 

Gave definition of 'goods':
"By goods...there must be understood products which can be valued in money and which are capable, as such, of forming the subject of commercial transactions"

 
3. 

Jagerskiold 1999

 

Goods are generally things you can touch:
They 'possess tangible physical characteristics'
Obvious Example: Comm v P'ment & Council Tabacco Ad)
Not so obvious eg: Campus Oil 1984

 
4. 

Donckelworke 1976

 

Article 29 TFEU
"...as regards free circulation of goods within the Community, products entitled to 'free circulation' are definitively and wholly assimilated to products originating in Member States".

 
5. 

Van Gend en Loos (1963)

 

postal company charged tariff on importing chemicals. contested it, paid it but then took it to court and relied on Art 30 which prohibits CDs and CEEs. Held that they were allowed to rely upon it, landmark case because it gave rise to the direct effect principle which states individuals can rely on the EU law to do with fiscal barriers to trade.

 
6. 

Commission v Italy ( Statistical Levy Case)

 

Gave definition of CEE
“Any pecuniary charge, however small and whatever its designation and mode of application,
which is imposed unilaterally on domestic or foreign goods by reason of the fact that they cross a
frontier and which is not a customs duty in the strict sense, constitutes a charge having equivalent
effect ... even if it is not imposed for the benefit of the State, is not discriminatory or protective in
effect and if the product on which the charge is imposed is not in competition with the domestic
product”.

 
7. 

Gingerbread Case & Diamantarbeiters

 

Article 30 catches both protectionist and non-protectionist charges

 
8. 

A v Ville de Seraing 2006

 

The requirement that the charge must be imposed on goods by reason of the fact that they cross a frontier - the charging even must be the importation/ exportation of goods from/to another Member State. Art 30 applies to charges levied at the frontier.

 
9. 

Comm v Germany 1988

 

the Court
recognised that a charge can be lawful in 3 circumstances:
(a) If it constitutes payment for genuine administrative services rendered to the
importer/exporter, of a sum in proportion to the service (“fees for services”)
(b) If it constitutes payment for inspections required by EU law (“fees for
inspections”)
(c) If it relates to a general system of internal dues applied systematically and
in accordance with the same criteria to domestic products and imported
products alike. In other words, if it falls within the scope of Article 110
TFEU (“internal taxation”)

 
10. 

Comm v Germany 1988

 

Fees for services:
The payment must be consideration for a genuine service of direct effect to the importer or exporter-must not be consideration for a service which benefits the public as a whole

 
11. 

Commission v Belgium (warehousing) 1983

 

the Court noted that Article 30 TFEU will not apply if the national court considers that “the charge in question is the consideration for a service actually rendered to the
importer and is of an amount commensurate with that service”.

 
12. 

Bauhuis v Netherlands 1977

 

Fees for inspection:
Where EU legislation requires an inspection to be undertaken by a State, the
national authorities can impose a charge in order to cover the costs of that
mandatory inspection

 
13. 

Comm v Belgium 1984

 

Where EU legislation permits an inspection to be undertaken by a State, the
national authorities cannot recover any fees charged from the traders

 
14. 

Conditions that must be satisfied so that inspection fees do not constitute a CEE:
Commission v. Germany, [1988]

 

(a) they do not exceed the actual costs of the inspections in connection with
which they are charged
(b) the inspections in question are obligatory and uniform for all the products
concerned in the EU
(c) they are prescribed by EU law in the general interest of the EU
(d) they promote the free movement of goods, in particular by neutralising
obstacles which could arise from unilateral measures of inspection adopted in
accordance with Article 36 TFEU

 
15. 

Will a charge that represents the levying of what is genuinely internal taxation constitute a charge having an equivalent effect?

 

Internal Taxation
It will not.
Kapniki 2000:
“It is settled case law that the essential feature of a charge having equivalent effect to a
customs duty which distinguishes it from an internal tax is that the former is borne solely by a
product which crosses a frontier as such, whilst the latter is borne by imported and domestic
products”.

 
16. 

Articles 30 TFEU & Article 110 TFEU are Mutually Exclusive:

 

E v Ministero delle France

 
17. 

Article 110 TFEU

 

No Member State shall impose, directly or indirectly, on the products of other Member States any
internal taxation of any kind in excess of that imposed directly or indirectly on similar domestic
products.
Furthermore, no Member State shall impose on the products of other Member States any internal
taxation of such a nature as to afford indirect protection to other products.
Vertically directly effective Lutticke v H

 
18. 

How to distinguish between 30 and 110

 

Kapniki Mikhailidis v. IKA, [2000] ECR I-
7145: “It is settled case law that the essential feature of a charge having equivalent effect to a customs
duty which distinguishes it from an internal tax is that the former is borne solely by a product which
crosses a frontier as such, whilst the latter is borne by imported and domestic products”.

 
19. 

Does the fact that a MS does not produce a specific product meant that Art 110 TFEU cannot apply?

 

No: Coop Co Frutta 1987

 
20. 

Article 110(1)
Article 110(2)

 

Prohibits discriminatory taxation in respect of goods which are similar
Prohibits protectionism in the taxation of goods which are in competition

 
21. 

Comm v France 1980

 

Similar products= 'have similar characteristics and meet the same needs from the point of view of consumers'.

 
22. 

Is there direct discrimination on the ground of origin (nationality)?

 

Direct discrimination can take 3 forms:
-Only the imported product is subject to the tax Lutticke v H
-The imported product is taxed at a higher rate than the domestic and imported goods Haahr Petroleum 1997
-If different methods are used for calculating tax for the domestic and imported goods Bobie 1976

 
23. 

Can Direct discrimination taxes be justified?
What is the outcome if they are found to be directly discriminatory?

 

NO
MS must equalize the tax paid by the similar products.

 
24. 

Is there indirect discrimination on the ground of origin (nationality)?

 

Humbolt 1985 brought back a powerful car, taxed, broke law because this tax only applied to foreign cars.Held, that a special tax imposed upon cars which exceeded a certain fiscal rating was contrary to Art.95 EEC when the only cars affected by the special tax were imported, in particular from other EEC States.

 
25. 

Can indirect discrimination be justified?

 

yes, objective justification

 
26. 

In order for the justification to be made out a number of things have to be proved:

 

In order for the justification to be made out a number of things have to
be proved:
(1) The national interest relied on must be unconnected with the origin
of the product
(2) The national interest must pursue an objective recognised by the
EU as legitimate
(3) The steps taken to protect that interest must be proportionate

 
27. 

If the contested taxation is found to be in violation of Art 110(1) then discrimination must be eliminated by:

 

(a) Either equalising the taxes imposed on domestic and imported goods;
or
(b) Extending a benefit enjoyed by domestic goods to imported goods.

 
28. 

Article 110(2) function of it:

 

“The function of the second paragraph of [Article110 TFEU] is to cover, in addition [to the first
paragraph], all forms of indirect tax protection in the case of products which, without being similar
within the meaning of the first paragraph, are nevertheless in competition, even partial indirect or
potential with, certain products of the importing country” (para. 6 of the Court’s judgment in
Case 168/78, Commission v. France, [1980] ECR 347)

 
29. 

How does the court decide whether the products are in competition?

 

It is basically using two ‘tests’:
a) The economic test which asks whether there is cross-elasticity of demand.
b) Other factors are taken into account

 
30. 

What happens is the 2 products are in competition?

 

If the Court finds that the two categories of products are in competition, then it
must consider whether the impugned tax system protects the domestic product (i.e.
there is protectionism).

 
31. 

Is there protectionism?

 

Comm v Italy (Bananas )

higher rate of tax on bananas than other fruit such as apples/pears products not similar because of different characteristics but products were in competition the higher tax on bananas afforded indirect protection to home-grown fruit


Comm v UK (wine and beer)

The Court of Justice has used a number of different tests to determine whether goods are in competition. Sometimes the Court has applied an economic test based on the cross elasticity of demand. However the Court will also take a range of other factors into account.

The best way to explain the way the Court has approached this issue is to look at the case of Commission v UK.

The facts are as follows:

In the late 1970s the UK government imposed a higher rate of tax on wine than it did on beer. Wine was taxed at £3.25 a gallon whereas beer was taxed at 61p a gallon. In terms of production it was clear that the veast majority of wine consumed in the UK was produced in France Germany and Italy wheras beer was largely made in the UK. The Commission challenged this arguing UK was in braech of Art 90.

The UK argued that the products were neither similar under art 90(1) or in competition with one another under art 90(2).

The ECJ agreed that the producst were not similar in view of the different manufacturing processes and the natural properties of the respective drinks.

However the ECJ held that the products were in competition with one another and thus UK had breached Art 90”92). The reasoning is as follows:

The Court considered whether consumers would substitute one product for another- that is drink wine instead of beer. The Court didn’t just consider whether existing consumers would substitute the producst but also whether future future consumers could substitute a product and stated that . Eventually the ECJ ruled that there was a comptitive relationship between beer and the most accessible wines (lightest and the cheapest)


 
32. 

If the contested tax is found to be in violation of Art 110(2) the MS must do what?

 

If the contested tax is found to be in violation of Article 110(2) TFEU the Member
State must remove the protective effect from its taxation scheme.
What is required is that the protectionism enjoyed by the domestic goods must be
removed so that the tax reflects the objective differences between the products.

 
33. 

Article 34

 

Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited
between Member States. Directly effective Ianelli 1977
but only vertically directly effective Vlaamse, ; Art 34 n 35 TFEU concern only public measures and not the conduct of undertakings.

 
34. 

R v Royal Pharmaceutical Society of Great Britain

 

HOWEVER, it should be noted that the Court of Justice has interpreted the
notion of “State” broadly so that not only the central government or the
authorities of a Member State are bound by Article 34 TFEU, but also bodies
which regulate the conduct of a particular profession or which are used as a
medium for the execution of a measure which is contrary to Article 34 TFEU

 
35. 

Commission v. France (Strawberries)

 

Note, also, that the State may have to take responsibility for the action of
individuals who have been disrupting the application of Article 34 TFEU,
even though the activity of the individuals is not itself caught by Article 34
TFEU. In such cases, the Court rules that the failure of a Member State to
act in a way which will stop individuals impeding the free movement of
goods amounts to a violation of Article 34 TFEU read together with Article
4(3) TEU.

 
36. 

MOREOVER, the statements made by a government official and which are
capable of impeding imports of goods from other Member States may be
attributable to his Member State

 

Case C-470/03, AGM-COS.MET, [2007] ECR I-2749

 
37. 

Art 34, 30 n 110 are mutually exclusive

 

Ianelli:
“However wide the field of application of Article [34] may be, it nevertheless does not include
obstacles to trade covered by other provisions of the Treaty ... obstacles which are of a fiscal nature or
have equivalent effect and are covered by Articles [28-30] and [110] of the Treaty do not fall within the
prohibition in Article [34]”.

 
38. 

Art 34 includes 2 fold prohibition:

 

1) QR
2) MEQRs

 
39. 

Definition of QR

 

Geddo v Ente 1973
“... measures which amount to a total or partial restraint of, according to the
circumstances, imports, exports or goods in transit”.

 
40. 

Henn v Darby 1980

 

Total Restraint:
“It is clear that this provision [Article 34 TFEU] includes a prohibition on imports inasmuch as this is the most extreme form of restriction”.
completely banned the porn coming in, was contrary but they could reject as a public morality thing.

 
41. 

Definition of MEQR

 

Dassonville Formula:
“All trading rules enacted by Member States which are capable of hindering, directly
or indirectly, actually or potentially, intra-Community trade are to be considered as
measures having an effect equivalent to quantitative restrictions”NOTE: Although in Dassonville the Court refers to “trading rules”, the Court in its
subsequent case-law, and consistently with the actual wording of Article 34 TFEU,
has replaced the phrase “trading rules” with the broader word “measures”. And in
certain cases, the Court went even further and ruled that even measures of a non
legally-binding nature can be caught by Article 34 TFEU, if they impede inter-state
trade (see “Buy Irish” case and AGM-COS.MET, mentioned above)
In Belgium there was a rule preventing the sale of products such as scotch whisky, without a certificate of authenticity. The trader had purchased his whisky in France, where no such measure existed, therefore he made his own certificate of authenticity. The trader was accused of forging the certificate, and was held by the Belgian court to be in breach of the law. The trader argued that this represented a quantitative restriction on trade, which would be in breach of Article 28 EC of the Treaty of Rome. The Belgian court therefore referred the case to the European Court of Justice as is permitted under Article 267 of the TFEU (at the time 234 EC).

The court held that the Belgian legislation requiring the certificate of authenticity represented a measure having equivalent effect of restricting trade, and was in breach of article 28 of the Treaty. The restriction meant that it was perfectly possible for a French seller of Scotch whisky to sell the whisky, whilst a short distance away in Belgium, a trader selling the same whisky would be subject to restrictions which would effectively create a restriction on their ability to compete with the French trader.

The court stated:

"All trading rules enacted by Member States which are capable of hindering, directly or indirectly, actually or potentially, intra-Community trade are to be considered as measures having an effect equivalent to quantitative restrictions"

Horspool and Humphreys note that this decision could include a "huge" range of restrictions[2], and that the court has sought to limit the range of the Dassonville decision, in cases such as Cassis de Dijon, which was decided a few years later.

 
42. 

distinctly applicable measures

 

(measures that are applicable only to non-domestic imports/exports)
Different burden in law + Different burden in fact
=
Distinctly applicable measure
=
Direct discrimination on the ground of origin of the products
(= direct discrimination against imported products [aka de jure
discrimination])
Distinctly applicable measures can only be justified under the Article
36 TFEU derogations (“the Treaty derogations”)
(Case 113/80, Commission v. Ireland (Irish souvenirs), [1981] ECR 1625)

 
43. 

indistinctly applicable measures

 

(measures that are applicable to both domestic and non-domestic imports/exports).
Indistinctly applicable measures are ones that, prima facie, do not favor domestic producers over importers, and whose effects are equal on both.

Same burden in law + Different burden in fact
=
Indistinctly applicable measure
=
Indirect discrimination on the ground of origin of the products
(= indirect discrimination against imported products [aka de facto
discrimination])
NOTE: Indistinctly applicable measures can be justified BOTH
under the Article 36 TFEU derogations (“the Treaty derogations”)
AND the mandatory requirements (to be seen below

 
44. 

Does art.34 prohibit both indistinctly and distinctly?

 

yes.

 
45. 

Cassis de Dijon

 

The case concerned the sale of "cassis de Dijon" (a type of crème de cassis) in Germany by an importer and retailer (Rewe). Crème de cassis is a blackcurrant liqueur produced in France containing 15% to 20% alcohol by volume. The German government had a law stipulating that products sold as fruit liqueur should contain not less than 25% alcohol by volume. Therefore, the Bundesmonopolverwaltung für Branntwein (a section of the German Federal Ministry of Finance) told Rewe that the cassis de Dijon could not be imported into Germany and marketed as a fruit liqueur. The importer argued that this represented a quantitative restriction on trade in breach of article 28 of the Treaty of Rome.

The ECJ held that the German legislation represented a measure having an effect equivalent to a quantitative restriction on imports, and that the law was in breach of article 28 of the Treaty. The court stated:

The concept of measures having an effect equivalent to quantitative restrictions on imports contained in article 30 [now 28] of the EEC treaty is to be understood to mean that the fixing of a minimum alcohol content for alcoholic beverages intended for human consumption by the legislation of a member state also falls within the prohibition laid down in that provision where the importation of alcoholic beverages lawfully produced and marketed in another member state is concerned.

The major outcome of this case is the principle of mutual recognition: the court held that there are no valid reasons why a product that is lawfully marketed in one member state should not be introduced in another member state. To soften this wide opening of the gates for intra-Community trading, the court went on to provide four mandatory requirements which might be accepted as necessary for restricting trading in addition to the fixed derogations of TFEU Art. 36 of the Lisbon Treaty:

...the effectiveness of fiscal supervision, the protection of public health, the fairness of commercial transactions, and the defence of the consumer.

 
46. 

Mathot 1987

 

reverse discrimination is not prohibited by EU law

 
47. 

2 principles arising from cassis de dijon

 

Mutual recognition
14. “.... There is therefore no valid reason why, provided that they have
been lawfully produced and marketed in one of the Member States,
alcoholic beverages should not be introduced into any other Member State;
the sale of such products may not be subject to a legal prohibition on the
marketing of beverages with an alcohol content lower than the limit set by
the national rules”.
Rule of reason/Mandatory requirements
8. “In the absence of Community rules it is for the Member States to
regulate all matters relating to the production and marketing of alcohol on
their own territory.
Obstacles to movement within the Community resulting from disparities
between national laws relating to the marketing of the products in question
must be accepted in so far as those provisions may be recognised as being
necessary in order to satisfy mandatory requirements relating in particular to
the effectiveness of fiscal supervision, the protection of public health, the
fairness of commercial transactions and the defence of the consumer”.

 
48. 

The post-Cassis jurisprudence on indistinctly applicable measures
Many of the cases on indistinctly applicable measures concern packaging and
presentation requirements.

 

Packaging Requirements
Case 261/81, Rau, [1982] ECR 3961
C-470/93, Mars, [1995] ECR I-1923
Product Requirements
Case 407/85, Drei Glocken, [1988] ECR 4233

 
49. 

HOWEVER, there have also been a number of cases which concerned indistinctly
applicable rules on market circumstances (“selling arrangements”)

 

Cases 60 & 61/84, Cinetheque, [1985] ECR 2605
Case 145/88, Torfaen, [1989] ECR 3851

 
50. 

Advantages of Cassis:

 

• National regulatory autonomy respected + retention of cultural identity
• Experimentation at national level
• Wider consumer choice
• Easier and quicker adaptation to technological change
• No excessive centralisation (No “Euro-products”)
• Race to the top?

 
51. 

PROBLEMS with the Court’s case-law post-Cassis

 

1. Race to the bottom?
2. Reduction in consumer protection and other non-economic interests? – Too
much emphasis on negative integration and, often, as a result of this, complete
deregulation
3. Perhaps, over-intrusion of EU law into national regulatory autonomy
since the Dassonville formula read together with Cassis de Dijon blurred
the outer boundaries of EU law. Should equal burden rules be caught by
Article 34 TFEU? Where does this branch of EU law stop?
Note: There is no de minimis rule applicable in the context of Article 34
TFEU (Joined Cases 177/82 and 178/82, Van de Haar, [1984] ECR
1797) but the concept of “remoteness” is used in order to exclude from the
scope of Article 34 TFEU measures whose effect is too “uncertain and
indirect” (see Case C-379/92, Peralta, [1994] ECR I-3453).

 
52. 

The diffculties prior to keck
The case law-paw prior to keck- equal burden rules in or out?

 

Oebel 1981: (out)
prohibited delivery of bakery products between 10 p.m. and 5.45 a.m. was challenged. that these rules did not infringe the rules against discrimination under Art.7. Nor did they breach the rules preventing indirect restrictions on exports or imports under Art.34.

Quietlynn, [1990] (out)

Held, that national legislation prohibiting the sale of sex objects from shops without a licence which applied to imported and domestic products did not impede trade between member states as it was simply a rule governing the distribution of such objects. The provisions were not intended to regulate trade in the goods in the Community and therefore was not of such a nature as to impede trade.

Vs.

Cinetheque (1985)

Held, that Art.30 EEC did not apply to national legislation which regulated the distribution of cinematographic works by banning their simultaneous exploitation in cinemas and in video cassette form for a limited period of time, provided that (a) the ban applied equally to home-produced and imported cassettes and (b) any barriers to intra-EEC trade created thereby did not exceed what was required for ensuring that the exploitation in cinemas of cinematographic works of all origins held priority over other means of distribution.

Torfaen 1989 (& the other 'sunday trading saga'
B traded at one of its stores on a Sunday in the area of the plaintiff council, selling items which were not exempted from the prohibition on Sunday trading contained in the Shops Act 1950 s.47 and Sch.5. The council brought proceedings in the magistrates court alleging breach of the Act and B contended that the relevant provisions of the Act were incompatible with Art.30 of the Treaty of Rome as they were equivalent to a quantitative restriction, which had direct effect.

Held, that s.47 of the 1950 Act is not contrary to Art.30 EC as being equivalent to a quantitative restriction on imports. Such national rules were legitimate and consistent with the objectives of public interest. They were not intended to govern patterns of trade; whether their effect exceeded what was necessary to achieve their recognised aim was a matter of fact for the national courts.

 
53. 

The problems

 

 Inconsistency between the various rulings of the Court 

Uncertainty

 Mechanical application of the Dassonville formula  Danger

of supranational law encroaching on traditional rules, habits

and uses of Member State law

 Increased burden on the workload of the ECJ

 The legitimacy of the ECJ was being eroded by its degree of

involvement in judging the reasonableness of any market

regulation, something that always involves a sizeable margin of

discretionary powers and complex economic and social policy

analysis. Should the ECJ have the power to examine and, even,

require the non-application of equal-burden national measures?

 Abusive use of EC law by traders: See para. 14 of Keck: “In

view of the increasing tendency of traders to invoke Article

30 [now Article 34] of the Treaty as a means of challenging

any rules whose effect is to limit their commercial freedom

even where such rules are not aimed at products from other

Member States, the Court considers it necessary to re-examine

and clarify its case law on this matter”.

 
54. 

Question: What is the purpose of Article 34 TFEU?

 

Is Article 34 TFEU intended to liberalise inter-state trade?

OR

Is Article 34 TFEU intended to encourage the unhindered pursuit of commerce in

the individual Member States, as some traders would argue?

This question was posed by Advocate General Tesauro in Case C-292/92,

Hünermund, [1993] ECR I-6787.

 
55. 

What are market circumstances rules?

 

are those concerning who sells

a product; when a product can be sold; where a product can be sold; and how

(e.g. with a gift) a product can be sold.

 
56. 

Dassonville and Cassis de Dijon are sufficiently broad so as to include within

the scope of Article 34 TFEU market circumstances rules, What are the questions posed from this statement?

 

 Should market circumstances rules be included within the scope of

Article 34 TFEU?

 Do they impede the achievement of the aim of Article 34 TFEU?

 What is the aim of Article 34 TFEU?

 
57. 

The Keck formula?

 

Keck, Para. 16:

“However, contrary to what has previously been decided, the application to

products from other Member States of national provisions restricting or prohibiting

certain selling arrangements is not such as to hinder directly or indirectly, actually

or potentially, trade between Member States within the meaning of the Dassonville

judgment … provided that those provisions apply to all affected traders operating

within the national territory and provided that they affect in the same manner, in

law and in fact, the marketing of domestic products and of those from other

Member States”.

Keck and market access

Keck, Para. 17:

“Where those conditions are fulfilled, the application of such rules to the sale of

products from another Member State is not by nature such as to prevent their

access to the market or to impede access any more than it impedes the access of

domestic products. Such rules therefore fall outside the scope of [Article 34] of the

Treaty”

 
58. 

what 2 categoris of rules is keck based on?

 

• Measures imposing product requirements (dealt under Cassis)

• Measures regulating selling arrangements (marketing circumstances) (dealt

under Keck)

• NB. If a measure falls in neither of these two categories, it is only assessed

under Dassonville (see, for instance, Case C-421/09, Humanplasma, Judgment

of 9 December 2010)

 
59. 

The two categories of rules and presumptions & the burden of proof:

It is clear that the rationale for the Keck formula is based in part upon the

distinction between dual-burden rules and equal-burden rules:

 

Keck seems to have provided a clear division of regulatory competence: the

producing State makes the initial choices about the level of regulation of product

requirements; while the importing State makes the initial choice for its territory

about the level of regulation of certain selling arrangements (sales, marketing,

distribution, and consumption).

 
60. 

what is a selling arrangement?

 

• No definition provided by the ECJ

• The Court recently summarised its case-law on what can be considered a

selling arrangement in Case C-71/02, Karner, [2004] ECR I-3025, para. 38:

“Provisions concerning inter alia the place and times of sale of certain

products and advertising of those products as well as certain marketing

methods are provisions governing selling arrangements within the meaning of

Keck and Mithouard”.

 
61. 

Examples of rules which have been considered by the Court to be regulating

selling arrangements

 

 National rules on the times and places at which goods could be sold

(Joined Cases C-69 & 258/93, Punto Casa, [1994] ECR I-2355 and

Joined Cases C-418-421/93, 460-462/93, 464/93, 9-11/94, 14-15/94,

Semeraro Casa, [1996] ECR I-2975)

 Rules requiring retailers of particular goods to have actual premises in

the locality (Case C-253/98, TK-Heimdienst, [2000] ECR I-151 and

Case C-322/01, DocMorris, [2003] ECR I-14887)

 Rules obliging retailers to be licensed (Case C-20/03, Burmanjer,

[2005] ECR I-4133)

 Rules prohibiting selling in private homes (Case C-441/04, A-Punkt,

[2006] ECR I-2093)

 Restrictions on advertising (Case C-412/93, Leclerc-Siplec, [1995]

ECR I-179

 
62. 

At times the classification of a national measure (indistinctly applicable

MEQR or certain selling arrangement) may prove difficult

 

 Case C-368/95, Familiapress, [1997] ECR I-3689.

11. ...even though the relevant national legislation is directed against a

method of sales promotion, in this case it bears on the actual content of the products,

in so far as the competitions in question form an integral part of the magazine in

which they appear. As a result, the national legislation in question as applied to the

facts of the case is not concerned with a selling arrangement within the meaning of

the judgment in Keck and Mithouard.

12. Moreover, since it requires traders established in other Member States

to alter the contents of the periodical, the prohibition at issue impairs access of the

products concerned to the market of the Member State of importation and

consequently hinders free movement of goods. It therefore constitutes in principle a

measure having equivalent effect within the meaning of Article [34] of the Treaty.

 Cases C-158 & 159/04, Alfa Vita Vassilopoulos, [2006] ECR I-8135

 
63. 

PROBLEMS WITH KECK

 

• The Court did not specify which of its previous case-law was overruled

(“contrary to what was previously decided”)

• The Court did not provide a clear definition of the term “selling arrangements”

• The distinction between product requirements and certain selling arrangements

is not clear (see Familiapress etc)

• The phrase “selling arrangements” is too narrow in that it cannot be

interpreted to include certain rules which are – obviously- harmless to interstate

trade (such as non-discriminatory restrictions on planning and building in

the green belt and non-discriminatory restrictions on use)

• The phrase “selling arrangements” is, also, sometimes too broad in that it

catches certain “dynamic” measures (such as restrictions on advertising and

therefore takes them outside the scope of Article 34 TFEU even though they

do affect inter-state trade)

 
64. 

The problem with dynamic selling arrangements

 

Static selling arrangements: rules relating to the hours at which shops may be

open, the length of time for which people may work, or the type of premises in

which certain goods may be sold.

Non-static or dynamic selling arrangements include the ways in which a

manufacturer chooses to market this specific product¸ through a certain form

of advertising, free offers, and the like.

The objection to taking the latter out of Article 34 TFEU is that they may

relate more closely to the definition of the product itself. Non-static selling

arrangements can form an integral aspect of the goods, in much the same way

as do rules relating to composition, labelling, or presentation.

Yet, it is clear from Keck that the Court regarded some such rules as selling

arrangements and hence outside Article 34.

E.G.

Case C-412/93, Leclerc-Siplec, [1995] ECR I-179

 
65. 

THE APPLICATION OF THE SECOND KECK CONDITION

 

Condition II of Keck: “Does not affect in the same manner, in law and in fact, the

marketing of domestic products and of those from other Member States”

Joined Cases C-34-36/95, De Agostini¸[1997] ECR I-3843

Case C-405/98, Gourmet, [2001] ECR I-1795

 
66. 

Moving awa from keck and towards a market access test? 3 cases

1st case

 

Commission v. Italy (mopeds) [2009]

Article 258 TFEU action brought by Commission against Italy. Question whether

Italian rules which prohibited mopeds, motorcycles, tricycles and quadricycles from

towing a trailer, were contrary to Article 34 TFEU.

Held:

The action was dismissed. The contested rules amounted to an MEQR and thus fell

within the scope of Article 34 TFEU because they hindered access to the Italian

market for trailers which were specially designed for motorcycles and were lawfully

produced and marketed in Member States other than Italy (paras. 49-58 of the

judgment). HOWEVER, they were justified by a mandatory requirement (road

safety) (paras. 59-69) and, thus, Italy can continue applying them and, thus, can

continue prohibiting mopeds, motorcycles, tricycles and quadricycles from towing a

trailer.

Reasoning:

The Dassonville formula – para. 33 of the judgment

The principles established in Cassis and Keck – paras. 34-36

Paragraph 37: “Consequently, measures adopted by a Member State the object or effect of

which is to treat products coming from other Member States less favourably are to be regarded as

measures having equivalent effect to quantitative restrictions on imports within the meaning of

Article [34 TFEU], as are the measures referred to in paragraph 35 of the present judgment. Any

other measure which hinders access of products originating in other Member States to the

market of a Member State is also covered by that concept”. (emphasis added)

 
67. 

2nd case:
Aklagaren v. Mickelsson and Roos
, Judgment of 4 June 2009, not

yet reported

 

Facts: This was an Article 267 TFEU reference which was made by a Swedish court

to the ECJ in the course of criminal proceedings brought by the Swedish Public

Prosecutor’s Office against Mr Mickelsson and Mr Roos for failure to comply with a

Swedish prohibition on the use of personal watercraft. The main issue on the facts

was whether Swedish regulations which provided that jet-skis may be used only in

general navigable waterways and in waters designated through rules made by the local

authority, were contrary to Article 34 TFEU.

Held: The contested rules amounted to an MEQR and thus fell within the scope of

Article 34 TFEU because they had the effect of hindering the access to the Swedish

market of personal watercraft. HOWEVER, they could be justified on a number of

grounds, provided that certain conditions were satisfied. So, Sweden can maintain

those rules provided that the conditions mentioned in para. 39 of the judgment are

fulfilled.

 
68. 

3rd case:
Ker-Optika
, Judgment of 2 December 2010, not yet reported

 

Facts: This was an Article 267 TFEU reference which was made by a Hungarian court

to the ECJ in the course of proceedings between Ker-Optika (a company selling

contact lenses via its Internet site) and the South Transdanubian Regional Directorate

of the national public health and medical services, concerning an administrative

decision whereby the latter prohibited Ker-Optika from selling contact lenses in

Hungary via the Internet. The decision was based on Hungarian legislation which

provided that contact lenses could only be sold in shops which specialise in the sale of

medical devices. The question that was referred, therefore, was whether national

legislation which authorises the sale of contact lenses only in shops which specialise

in the sale of medical devices and which prohibits, consequently, the sale of contact

lenses via the Internet, is contrary to Article 34 TFEU.

Held: Articles 34 and 36 TFEU preclude national legislation which authorises the

selling of contact lenses only in shops which specialise in medical devices.

 
69. 

Contrast paras. 16 & 17 of Keck with para. 51 of Ker-Optika

 

Para. 16 of Keck:

By contrast, contrary to what has previously been decided, the application to

products from other Member States of national provisions restricting or prohibiting

certain selling arrangements is not such as to hinder directly or indirectly, actually

or potentially, trade between Member States within the meaning of the Dassonville

judgment, so long as those provisions apply to all relevant traders operating within

the national territory and so long as they affect in the same manner, in law and in

fact, the marketing of domestic products and of those from other Member States.

Para. 17 of Keck:

Provided that those conditions are fulfilled, the application of such rules to the sale

of products from another Member State meeting the requirements laid down by that

State is not by nature such as to prevent their access to the market or to impede

access any more than it impedes the access of domestic products. Such rules

therefore fall outside the scope of Article [34] of the Treaty.

Para. 51 of Ker-Optika:

For that reason, the application to products from other Member States of national

provisions restricting or prohibiting certain selling arrangements is such as to hinder

directly or indirectly, actually or potentially, trade between Member States for the

purposes of the case-law flowing from Dassonville, unless those provisions apply to

all relevant traders operating within the national territory and affect in the same

manner, in law and in fact, the selling of domestic products and of those from other

Member States. The application of such rules to the sale of products from another

Member State meeting the requirements laid down by that State is by nature such as

to prevent their access to the market or to impede such access more than it impedes

the access of domestic products.

 
70. 

Once it is decided that a national measure is caught by Article 34 TFEU

because it is either a QR or an MEQR, the next issue is whether it is

justified. what are the 2 types of justification?

 

 The Treaty Derogations (Article 36 TFEU)

 The mandatory requirements (recognised, for the first time, in Cassis

de Dijon)

 
71. 

qrs and distinctly applicable meqrs may be justified only under what?

 

art 36 tfeu derogations

 
72. 

indistinctly applicable meqrs may be justified under what?

 

art 36 tfeu derogations and the madatory requirements

 
73. 

when determining whether a measure is justified, it is not suffiicient to point to a lefitimate non-economic aim which is acheived through the same measure it must also be what?

 

proved that the measure is proportionate

 
74. 

the article 36 derogations

 

The provisions of Articles 34 and 35 shall not preclude prohibitions or restrictions on imports, exports

or goods in transit justified on grounds of public morality, public policy or public security; the

protection of health and life of humans, animals or plants; the protection of national treasures

possessing artistic, historic or archaeological value; or the protection of industrial and commercial

property.

Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a

disguised restriction on trade between Member States.

 
75. 

In order for a national measure (a QR or an MEQR) to take precedence over the free

movement of goods and thus not become inapplicable even though it imposes an

obstacle to the free movement of goods, it must satisfy 3 requirements:

 

 It must serve one (or more) of the important interests that are included

on the Article 36 TFEU list (e.g. public health or public morality)

 It must be proportionate

 It must not constitute a means of arbitrary discrimination or a disguised

restriction on trade between Member States

 
76. 

POINTS TO REMEMBER:

 

• The Court has interpreted Article 36 TFEU strictly

• The burden of proof is on the national authorities to demonstrate that their

measures are suitable and necessary to give effective protection to the

interest(s) on which they rely from the Article 36 list (Case C-17/93,

Openbaar Ministerie v. Van der Veldt, [1994] ECR I-3537).

• The derogations cannot be used to serve economic objectives: Case 7/61,

Commission v. Italy (pork), [1961] ECR 317, at p. 329: Article 36 TFEU is

“directed to eventualities of a non-economic kind”. Such objectives as the

promotion of employment or investment, curbing inflation, and controlling the

balance of payments fall outside Article 36 TFEU.

• The Article 36 TFEU list is EXHAUSTIVE and has never been amended since

the original drafting of the EEC Treaty

 
77. 

1. THE ARTICLE 36 TFEU PROVISO

 

“Such prohibitions or restrictions shall not, however, constitute a means of arbitrary

discrimination or a disguised restriction on trade between Member States”.

Purpose of this proviso:

Compare .....

Case 34/79, Henn and Darby, [1979] ECR 3795

....... With

Case 121/85, Conegate, [1986] ECR 1007

 
78. 

2. PROPORTIONALITY

 

The Court has long emphasised that the measures taken by the Member States must

not only genuinely serve the purpose for which they are intended but they must also

be proportionate to the risk presented by the import, with the burden of proving

proportionality resting with the defendant State.

 
79. 

The principle of proportionality comprises essentially two tests:

 

• A test of suitability

• A test of necessity - One important part of the “necessity” limb is the question

whether there are any other less restrictive means of producing the same result

(the most usual example are cases involving a reliance on consumer protection

where the Court says that a less restrictive alternative will be labelling -- Case

120/78, Rewe-Zentral AG v. Bundesmonopolverwaltung für Branntwein

(“Cassis de Dijon”), [1979] ECR 649); Case 178/84, Commission v. Germany

(beer), [1987] ECR 1227.

 
80. 

3. ARTICLE 36 TFEU VS. POSITIVE HARMONISATION

 

 NOTE!!!!!!!!!! A Member State can invoke the Article 36 TFEU derogations

only in the absence of Union legislation, provided that the harmonisation occupies

the field to the exclusion of Member State competence (Case 190/87, Moorman,

[1988] ECR 4689). In Case C-5/94, Hedley Lomas, [1996] ECR I-2553, para. 18,

the Court said: “recourse to Article [36] is no longer possible where Community

Directives provide for harmonisation of measures necessary to achieve the specific

objective which would be furthered by reliance upon this provision”.

See, also, pp. 704-705 of Craig and de Burca, EU Law: Text, Cases and Materials

(Oxford, OUP, 2008).

 
81. 

4. THE DEROGATIONS AND THE COURT’S CASE-LAW

 

• The Article 36 TFEU list of derogations is EXHAUSTIVE:

 Public morality

 Public policy

 Public security

 Protection of health and life of humans, animals or plants

 Protection of national treasures possessing artistic, historic or archaeological

value

 Protection of industrial and commercial property

 
82. 

public morality:

 

henn v darby
conegate

 
83. 

public policy

 

Narrow interpretation in the context of goods: Case 177/83, Ringelhan, [1984]

ECR 3651, the Court made it clear that “public policy” does not include

considerations of consumer protection.

Only relied on successfully once: Case 7/78, Thompson, [1978] ECR 2247

The public policy derogation has increasingly been invoked

UNSUCCESSFULLY by Member States to justify interference with the free

movement of goods caused by protesters. See, e.g. Case 231/83, Cullet v.

Leclerc, [1985] ECR 305.

 
84. 

public security

 

Case 72/83, Campus Oil, [1984] ECR 2727

“the aim of ensuring a minimum supply of petroleum products at all times was to be regarded as

transcending purely economic considerations”.

“It should be stated ... that petroleum products, because of their exceptional importance as an energy

source in the modern economy, are of fundamental importance for a country’s existence since not only

its economy but above all its institutions, its essential public services and even the survival of the

inhabitants depend upon them. An interruption of supplies of petroleum products, with the resultant

dangers for the country’s existence, could therefore seriously affect the public security that Article [36]

allows States to protect”.