Free Movement of Goods
TFEU
Article 34: Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.
Article 35: Quantitative restrictions on exports, and all measures having equivalent effect, shall be prohibited between Member States.
Article 36: 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.
Article 34: Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.
Article 35: Quantitative restrictions on exports, and all measures having equivalent effect, shall be prohibited between Member States.
Article 36: 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.
Dassonville
Dassonville was a case in the European Court of Justice, in which a 'distinctly applicable measure of equivalent effect' to a quantitative restriction of trade in the European Union was held to exist on a Scotch whisky imported from France.
The court held that the Belgian legislation requiring the certificate of authenticity represented a measure having equivalent effect of restricting trade and 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, but a short distance away in Belgium, a trader selling the same whisky would be subject to restrictions that 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."
This decision could include a "huge" range of restrictions. 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.
The court held that the Belgian legislation requiring the certificate of authenticity represented a measure having equivalent effect of restricting trade and 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, but a short distance away in Belgium, a trader selling the same whisky would be subject to restrictions that 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."
This decision could include a "huge" range of restrictions. 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.
Cassis de Dijon
Cassis de Dijon is also about the marketing of alcohol beverages (Cassis is a blackcurrant fruit liqueur, made in France). Cassis could not be imported into Germany, because its alcoholic content was too low in order to satisfy the requirements of German law: German law prohibited the marketing of liqueurs with an alcoholic strength of less than 25%; Cassis de Dijon, with an alcoholic strength of about 15-20% could therefore not compete with German products. Put differently, the problem addressed by Cassis was inter-state regulatory diversity; the effect was the exclusion from the German market of a product - namely Cassis - lawfully produced and marketed in France.
Hence there was an obstacle to free trade.
Germany tried to justify its domestic regulations on two grounds: (i) public interest: the proliferation of alcoholic drinks with a low alcoholic strength on the German market would have the effect of inducing a tolerance among consumers towards alcoholic drinks in general, and more so than stronger alcoholic beverages would; and (ii) German companies' interest: cheaper drinks with lower alcoholic strength would have an unfair competitive advantage over stronger, more costly, German drinks.
The ECJ was unconvinced and held that even though in the absence of common rules it is for Member States to regulate matters, the host state can apply its own rules only if there is a sufficient justification in the public interest to prevail over the interest of free trade, and there was no sufficient public interest justification found here.
According to the mandatory requirements test, in the absence of common rules at Community level relating to the marketing of the products in question, goods lawfully produced in any Member State could in general be imported into any other State; however, obstacles to free movement resulting from disparities between the national laws must be accepted provided that such rules are:
IF THE MEASURE AT QUESTION IS INDISTINCTLY APPLICABLE, WE USE THE CASSIS FORMULA, AND IF IT IS DISTINCTLY APPLICABLE (I.E. DIRECTLY DISCRIMINATORY), WE USE ART. 36 (TFEU).
Hence there was an obstacle to free trade.
Germany tried to justify its domestic regulations on two grounds: (i) public interest: the proliferation of alcoholic drinks with a low alcoholic strength on the German market would have the effect of inducing a tolerance among consumers towards alcoholic drinks in general, and more so than stronger alcoholic beverages would; and (ii) German companies' interest: cheaper drinks with lower alcoholic strength would have an unfair competitive advantage over stronger, more costly, German drinks.
The ECJ was unconvinced and held that even though in the absence of common rules it is for Member States to regulate matters, the host state can apply its own rules only if there is a sufficient justification in the public interest to prevail over the interest of free trade, and there was no sufficient public interest justification found here.
According to the mandatory requirements test, in the absence of common rules at Community level relating to the marketing of the products in question, goods lawfully produced in any Member State could in general be imported into any other State; however, obstacles to free movement resulting from disparities between the national laws must be accepted provided that such rules are:
- Applicable to domestic and imported products without distinction;
- Necessary to satisfy certain mandatory requirements recognised by Community law—but in fact identified by the ECJ for the first time in the Cassis de Dijon judgment; and
- Proportionate to the aim in view, that is, they constitute a measure which least restricts the free movement of goods.
IF THE MEASURE AT QUESTION IS INDISTINCTLY APPLICABLE, WE USE THE CASSIS FORMULA, AND IF IT IS DISTINCTLY APPLICABLE (I.E. DIRECTLY DISCRIMINATORY), WE USE ART. 36 (TFEU).
Stoke-on-Trent Borough Council v B&Q PLC (Sunday Trading)
Several large retailers, including B&Q, decided to open their shops on Sundays contrary to the Shops Act of 1950. Many retailers were prosecuted by the local authorities. In response, the retailers challenged the restrictions of the Shops Act as being contrary to EU law on the free movement of goods. They argued that the prohibition on Sunday trading had the effect of reducing the stores’ overall volume of sale. Since a significant part of their sales involved products from other Member States, the result was a decrease in imports and a hindrance of trade within the EU.
"The legislation at issue pursued an aim which was justified under Community law. National rules restricting the opening of shops on Sundays reflected certain choices relating to particular national or regional socio-cultural characteristics. It was for the Member States to make those choices in compliance with the requirements of Community law, in particular the principle of proportionality."
The Court held that B&Q was exploiting the ruling of Dassonville to challenge national laws which in actual fact had a rather limited effect on trade and imports. Also, it was indistinctly applicable, so it was not just imports that had the legislation affected.
"The legislation at issue pursued an aim which was justified under Community law. National rules restricting the opening of shops on Sundays reflected certain choices relating to particular national or regional socio-cultural characteristics. It was for the Member States to make those choices in compliance with the requirements of Community law, in particular the principle of proportionality."
The Court held that B&Q was exploiting the ruling of Dassonville to challenge national laws which in actual fact had a rather limited effect on trade and imports. Also, it was indistinctly applicable, so it was not just imports that had the legislation affected.
Keck
Two supermarket managers in the Strasbourg region, Messieurs Keck and Mithouard, were prosecuted for having sold Picon beer and Sati coffee at a price lower than the effective purchase price of those products. At trial, the two managers advanced the defense that the French law prohibiting such sales violated the European Community’s rules on the free movement of goods and, more specifically, Article 30 of the EC Treaty. This provision prohibits, in the Community’s jargon, “measures having an effect equivalent to quantitative restrictions." The French legislation was indistinctly applicable. Keck has the effect of limiting the very catch of Art. 28 EC, to the effect that certain domestic measures, if they can be qualified as selling arrangements, do not even have to be justified.
Since the economic legislation applied 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...' they didn't have to give a public interest justification.
Since the economic legislation applied 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...' they didn't have to give a public interest justification.
Gourmet
TFEU
Article 28
1. The Union shall comprise a customs union which shall cover all trade in goods and which shall involve the prohibition between Member States of customs duties on imports and exports and of all charges having equivalent effect, and the adoption of a common customs tariff in their relations with third countries.
Article 28
1. The Union shall comprise a customs union which shall cover all trade in goods and which shall involve the prohibition between Member States of customs duties on imports and exports and of all charges having equivalent effect, and the adoption of a common customs tariff in their relations with third countries.