EU Law (Free movement of goods)

Question 1

Commission v Italy 7/68

Answer 1

A custom duty is a charge, determined on the basis of a tariff, specifying the rate of duty to be paid by the importer at the borders to the host state

Question 2

Commission v Italy 24/68

Answer 2

“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…constitutes a charge having an 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”.

What are the names under which CEE come?
-A “statistical levy”.
-An “inspection service”.
-A “public health inspection levy”
-An “administrative service levy”

Question 3

But, a CEE will escape the prohibition of Article 28, only if both the following conditions are met:

Answer 3

• it constitutes payment for a service rendered
  -this service is rendered compulsory by EU Law

Question 4

Sociaal Fonds

Answer 4

-A charge on diamonds was imposed by the Belgian government at the border
-There was no diamond industry in Belgium
-The charges were used to provide for social funding for several types of workers.
-The CEE was caught by the Treaty because it imposed additional costs on the imported product rendering its importation more difficult or costly.

-What matters is the effect of the charge.

Question 5

Commission v Germany 18/87

Answer 5

Facts: Germany imposed a fee to cover the cost of veterinary inspections on imported livestock, which were required under an EU directive aimed at protecting animal health.

Legal Question: Was this charge a prohibited CEE?

Held (CJEU): No, it was not a prohibited CEE, because:

Question 6

Commission v Belgium

Answer 6

Facts: Belgium imposed a fee on imported goods to fund an inspection required only by Belgian law (not EU law). The inspections didn’t provide a clear benefit to the goods’ importers.

Issue: Was this inspection charge a CEE contrary to EU law?

Held (Court of Justice): Yes, it was a prohibited CEE.

Question 7

Haahr Petroleum
Dounias v Oikonomikon

Answer 7

a MS internal taxation system will be compatible with the requirements of 110TFEU (90EC) only if it is shown to be structured so as to exclude any possibility of a discriminatory effect (of imported against domestic products)”.

Question 8

Commission v Denmark

Answer 8

On similar domestic and imported products.

Products: “domestic fruit wines and imported wines made from grapes”.

“It is necessary first to consider certain objective characteristics of both categories of beverages, such as their origin, their method of manufacture and their organoleptic properties, in particular taste and alcohol content and second to consider whether or not both categories of beverages are capable of meeting the same needs from the point of view of the consumers”.

Question 9

Humblot
Commission v Greece

Answer 9

Tax imposed on the basis of the power rating of the car. The higher the PR of the car, the higher the tax. German cars were taxed at top rates in both France and Greece.

Humblot- Indirectly discrimatory
Commission- not indirectly discrimatory because it does not have car industry to protect

Question 10

Article 110(2)TFEU: If the products are not found to be “similar”, then the Court will examine whether they are “in competition with each other” for the purposes of Article 110(2)TFEU.

Answer 10

A criterion at this stage can be the cross elasticity of demand test. Question: If the price of one product is increased, will the consumers switch to the other product

For example, people wanting to buy bananas will not switch to oranges if the prices are too high

INTERCHANGEABLE AND SUBSTITUTABLE

Question 11

CONSEQUENCE

If the products are found to be “in competition with each other” for the purposes of Article 110(2)TFEU

Answer 11

narrowing the gap between the respective tax rates. The tax rates on the imported and domestic products should come closer. But, there is no obligation to be made equal

Question 12

Article 34TFEU will catch

Answer 12

a) quantitative restrictions and
b) measures with an equivalent effect to quantitative restrictions (MEQR)

Question 13

Geddo v Ente Nazionale Risi

Answer 13

“measures which amount to a total or partial restraint of, according to circumstances, imports,
exports or goods in transit”

Question 14

Commission v Italy

Answer 14

a ban

Question 15

Salgoil SpA v Italian Ministry of Foreign Trade

Answer 15

a quota system

Question 16

International Fruit Company BV v Produktschap voor Groenten en Fruit

Answer 16

a license

Question 17

Commission v Ireland

Answer 17

The list of factors included in Article 30 as basis for
derogation is exhaustive.

Question 18

Commission v UK

Answer 18

• The UK switched from a vaccination policy (used by most EU Member States) to a slaughter policy to address Newcastle disease, a contagious disease affecting poultry.
  -Just before Christmas 1981, the UK banned imports of poultry, mainly from France, claiming the move was to prevent the spread of the disease.

However, evidence showed that:

-The ban coincided with a surge in French poultry imports.
-British producers had lobbied the government for protection against competition.
-The ban was suspiciously timed to block French turkeys during the Christmas season, a key market period.

The CJEU ruled that:
The import ban was a quantitative restriction under Article 34 TFEU.

Question 19

Why not protect local producers in the first place?

Answer 19

If a state “protects” its local producers by banning competition from foreign products and imports then:
1) The local producers will no longer be motivated to enhance the quality of their products as competition would already be squeezed out of the market. Then,

2) The prices will go up. This is because when foreign competition is squeezed out of a market, then we have an “oligopoly” namely a market with only a few local players.

3) The latter can all agree to raise the price of the products or services; “concerted practices”. The local consumers will be forced to pay high prices as they will have no alternative to switch to. Foreign products are banned.

4) In this case, local producers accumulate wealth as they offer products of low quality and of high prices, while the consumers face increased bills and products or services of diminished quality.

5) The consumers are the big losers in this game, while a few local producers become very profitable but not competitive.

Question 20

Commission v Ireland Case 113/80

Answer 20

Ireland prohibited the sale of imported articles of jewellery depicting Irish personalities and landscapes unless they bear an indication of the word “foreign”.

So, the rule was applicable only to imported products rendering them more expensive and less attractive.

Question 21

Distinctly Applicable MEQR are

Answer 21

-Caught by article 34TFEU.
-Exempted ONLY on the basis of article 36TFEUand “Environmental Protection”.

Question 22

Commission v Belgium C-2/90

Answer 22

Toxic Waste

Question 23

Mathot Case 98/86

Answer 23

“Belgian butter case” Article 34TFEU does not apply to wholly internal situations reverse discrimination can be found to be compatible with EU Law.

Question 24

Article 3 of directive 70/50/EEC

Answer 24

“measures…equally applicable to domestic and imported products, where the restrictive effect of such measures on the free movement of goods exceeds the effects intrinsic to trade rules. Indistinctive applicable rules may be acceptable provided that they comply with the principle of proportionality.

Question 25

Procureur du Roii v Dassonville

Answer 25

“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”.

Question 26

Commission v France (“Foie Gras” Case)

Answer 26

-French law laid out very restrictive requirements which needed to be satisfied before a product could be labelled and marketed as ‘foie gras’ (a French food product, which is very popular in France especially during Christmas) -France argued that this is legitimate since this product is consumed mostly in France (98% of the market) and manufactured mostly in France. This is true. -The CJEU stated that although that was true, trade in foie gras would be restricted, if non-French producers were discouraged and prevented to enter the market of FG and to compete with the French producers. It would have been very difficult for them to meet the tough French criteria. Therefore, only the French producers will be left in this market IMPORTANT CJEU: The rules constituted “national trading rules capable of potentially hindering intra-community trade”.

Question 27

The doctrine of: “Dual / Double Burden”

Answer 27

-“In the Single Market you cannot be called to satisfy again the same set of requirements, which were already met at the country of origin”. -So, once goods have been lawfully marketed in one MS, having satisfied all relevant requirements and rules there, they should be admitted into any other MS without restriction. Producers should not be called to satisfy the same requirements twice: -Once in their home state and then again in another member state of the EU. Product requirement rules are the most important barriers to trade as they add important costs to products when passing imported to different countries.

Question 28

These rules and requirements can involve the following (examples of indistinctly applicable MEQR):

Answer 28

-the composition, -shape, -size, -content, -weight, -labelling, -packaging and -identification of the product

Question 29

Rau 261/81

Answer 29

Packaging and identification: -The Court stated that a Belgian law requiring margarine to be marketed in cube-shaped packages to avoid confusion with butter was an indistinctly applicable MEQR because it had the effect of requiring imported margarine to be repackaged before being sold on Belgian market adding therefore extra costs to the producer.

Question 30

Cassis de Dijon

Answer 30

Germany refused to accept CdD, a fruit liqueurs made in France to be sold in Germany due to its insufficient alcohol strength. German law allowed fruit liqueurs to have a minimum alcohol content of 25%, while the French Cassis had an alcohol content of 15-20%.

Question 31

The “Rule of Reason” of the Cassis de Dijon case.

Answer 31

The Court spelled out the “rule of reason”: “obstacles to movement in the Community resulting from disparities between the 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 (rule of reason) relating in particular to the: i) effectiveness of fiscal supervision, ii) the protection of public health, iii) the fairness of commercial transactions and the iv) defence of the consumer”. To this the Court added in Rue Case 261/81: “it is also necessary for such rules to be proportionate to the aim in view.

Question 32

SO, an indistinctly applicable MEQR which prevents goods lawfully produced in State A from being sold in the market of State B constitutes a breach of Article 34TFEU. BUT:

Answer 32

1) If it satisfies ONE of the mandatory requirements of the Cassis case (rule of reason) or, 2) If it falls within the exemption of Article 36TFEU and 3) If it is proportional, then there is no breach of Article 34TFEU and the national interest takes precedence over the free movement of goods. In Cassis itself, this was not the case. The German rule was found to be in breach of article 34.

Question 33

Aklagaren v Percy Mickelsson and Joakim Roos

Answer 33

Rules concerning the “use” of products. National legislation prohibited the use of personal watercraft on waters other than designated waterways. “Even if the national regulations at issue do not have the aim or effect of treating goods coming from other MS less favourably...the restriction which they impose on the use of a product in the territory of a MS may...have a considerable influence on the behaviour of the consumers, which may in turn affect the access of the product to the market of that MS. In that regard, where the national regulations for the designation of navigable waters and waterways have the effect of preventing users of personal watercraft from using them...such regulations have the effect of hindering the access to the domestic market in question for those goods and therefore constitute save where there is a justification pursuant to article 36TFEU...MEQR on imports prohibited by Article 34TFEU”. Here the CJEU accepted that the national rule could be justified for the protection of the environment.

Question 34

Keck

Answer 34

The Market Circumstances / Selling Arrangements Rules. -Keck sold goods (beer and coffee) at a loss (at a price below that at which they had been purchased wholesale). This was a method of sales promotion/marketing of his products. -This method comes in contrast to French law. -Keck argued that because the French law deprived them of a method of sales promotion, it restricted the volume of sales of imported goods and so was incompatible with Article 34. -The Court disagreed. It began by noting that the purpose of the French rule was not to regulate trade in goods. In the view of the “increasing tendency of traders to invoke article 34 of the Treaty as a means of challenging any restriction to sell what they wanted, when they wanted and where they wanted”.

Question 35

The Market Circumstances / Selling Arrangements Rules.

Answer 35

The Court drew a distinction between “product requirements” on the one hand where the Cassis principles apply and “selling arrangements” on the other. The Court clarified that “selling arrangements” will NOT breach Article 34TFEU, if two conditions are met: 1) the provisions apply to both domestic and imported products 2) the provisions apply the same in law and in fact If both requirements are met, then the selling arrangement/market circumstance rule will escape the prohibition of article 34TFEU altogether. And it will continue to be in place.

Question 36

Gourmet

Answer 36

Swedish rules limited the advertising of all alcohol to certain points of sale and press. The prohibition was applicable to all alcohol products; domestic and imported ones. 1) The rules were found to apply equally in law (they applied to both domestic and imported products alike) 2) But differently in fact ~they affected imports more heavily as the Swedish consumers were already accustomed to their national Swedish alcohol products therefore, the ban of their advertising did not affect the sales of Swedish products. In contrast to that, the ban of advertising of foreign imported alcohol products eliminated their sales, as Swedish consumers were not aware of them. Advertising was necessary to make them known to the Swedish public.

Question 37

Commission v France C-265/95

Answer 37

(the right to free movement v the right to demonstration/assembly) -Farmers’ demonstration causes considerable unrest that disrupted the free movement of goods for several months. The French government was found to have taken insufficient measures to prevent French farmers from disrupting imports of agricultural products from other EU countries.

Question 38

Schmidberger C-112/00

Answer 38

(the right to free movement v the right to demonstration/assembly) -Austria authorised a 28hour demonstration. The main transit route across the Alps was blocked. Goods were transferred through an alternative route.