Free movement of goods

Non-tarrif barriers
1. Art 34 TFEU: Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between Member States.
2. Art 35 TFEU: Quantitative restrictions on exports, and all measures having equivalent effect, shall be prohibited between Member States
3. Gaston Schul: The concept of a common market as defined by the court in a consistent line of decisions involves the elimination of all obstacles to intra‐community trade in order to merge the national markets into a single market bringing about conditions as close as possible to those of a genuine internal market.
4. Hünermundand: “Is Article [34]of the Treaty a provision intended to liberalize intra‐Community trade or is it intended more generally to encourage the unhindered pursuit of commerce in individual Member States?”
5. Article 34 TFEU applies also indirectly to private standardisation bodies that hold quasi regulatory powers, can create horizontal direct effect
  1. Fra. Bo: Article 34 TFEU “must be interpreted as meaning that it applies to standardisation and certification activities of a private-law body, where the national legislation considers the products certified by that body to be compliant with national law and that has the effect of restricting the marketing of products which are not certified by that body.”
  2. Van de Haar: “It is important to bear in mind the context in which those two provisions of the Treaty are situated. Article [101TFEU] belongs to the rules on competition which are addressed to undertakings and associations of undertakings and which are intended to maintain effective competition in the common market. [...] Article [34 TFEU], on the other hand, belongs to the rules which seek to ensure the free movement of goods and, to that end, to eliminate measures taken by member states which might in any way impede such free movement. [...].” Difference of competition law
  3. Commission v Ireland ('Buy Irish'), Apple and Pear Development Council v Lewis: As the Court held in its judgment of 24 November1982 in case 249/81, Commission v Ireland [1982]ECR 4005, a publicity campaign to promote the sale and purchase of domestic products may, in certain circumstances, fall within the prohibition contained in Article [34] of the Treaty, if the campaign is supported by the public authorities. In fact, a body such as the development council, which is set up by the government of a member state and is financed by a charge imposed on growers, cannot under community law enjoy the same freedom as regards the methods of advertising used as that enjoyed by producers themselves or producers' associations of a voluntary character.
  4. The state may also be held responsible if state authorities fail to restrain the activities of private actors which impede free movement
    1. Commission v France
    2. Schmidberger v Austria
  5. If a regulatory activity carried out by professional body with tasks laid down by law, these activities may create barriers
    1. R v Pharmaceutical Society ex parte Association of Pharmaceutical Importers: It should be stated that measures adopted by a professional body on which national legislation has conferred powers of that nature may, if they are capable of affecting trade between Member States, constitute "measures" within the meaning of Article [34] of the Treaty.
  6. Where a private body effectively exercises control over access to market, activities are subject to scrutiny under art 34 TFEU
    1. Fra.bo SpA v Deutsche: In such circumstances, it is clear that a body such as the DVGW, by virtue of its authority to certify the products, in reality holds the power to regulate the entry into the German market of products such as the copper fittings at issue in the main proceedings.
Quantitative restrictions: bans or quotas or quantitative limitations on the import or exports of goods
1. Geddov.Ente Nazionale Risi: “The prohibition on quantitative restrictions covers measures which amount to a total or partial restraint of, according to the circumstances, imports, exports or goods in transit. Measures having equivalent effect not only take the form of restraint described; whatever the description or technique employed, they can also consist of encumbrances having the same effect.”
2. Operates at time or import or export rather than when goods are sold
3. R v Henn and Derby: ECJ agreed that it was acceptable for the UK to restrict the import of pornographic films into the UK because it was up to each MS to set its own standards of public morality and there was no lawful trade in these items in the UK.
4. Restrictions on import of tobacco and alcohol
  1. Under Swedish law, illegal to import alcohol into country
    1. Rosengren and others: number of individuals were prosecuted for privately arranging the import of cases of wine from a Spanish company. Held: in the absence of a counter‐balancing obligation in every case on the monopoly to import such beverages when requested to do so by private individuals, constitutes a quantitative restriction on imports
  2. Spanish tobacco monopoly
    1. AsociaciónNacional de Expendedores de Tabaco y Timbre: The difference between the two situations was that in Rosengren there was a prosecution for directly importing goods from other Member States. In the Spanish case, the issue was more the general capacity of the rules to hinder market access for tobacco sources from outside Spain
Measures having equivalent effect (MEQRs)
1. Procureur du roi v Dassonville: "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".
2. Distinctly applicable measures (imports)
  1. Requiring import and export licenses
    1. Commission v France
    2. Denkavit Futtermittel v Mininster für Ernährung
  2. Inspections of imports or exports only
    1. Procureur de la Republique v Bouhelier: export inspection of watches
    2. If claim justified on health grounds, must have equivalent checks on domestic products
      1. Rewe Zentralfinanz
  3. "Buy national" campaigns
    1. Commission v. Ireland (“buy Irish campaign”)
    2. Apple and Pear Development Council (“buy British fruit”)
  4. Designations of quality and/or origin
    1. Commission v. Germany: The only time designations of origins are lawful is where they genuinely reflect special characteristics
  5. Reverse discrimination
    1. Ministère Public v. Mathot: art 34 does not preclude reverse discrimination
    2. Pistre: uncertain future
3. Indistinctly applicable measures - the Cassis approach: measures which genuinely apply to both national and domestic products in the same way but they have a particular burden on the imported goods
  1. Cassis de Dijon: "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". Established the principle that goods which lawfully comply with the rules in force in the Member State in which they are produced or first placed on the market, they should, in principle enter into free circulation. For the Member State of import to demand compliance with its own rules would subject goods to an additional regulatory cost (dual burden).
  2. Commission v Germany (Beer purity): Although it applies to all products without distinction, a prohibition such as that in question in the main proceedings, which relates to the marketing in a Member State of products bearing the same publicity markings as those lawfully used in other Member States, is by nature such to hinder intra‐ Community trade. It may compel the importer to adjust the presentation of his products according to the place where they are to be marketed and consequently to incur additional packaging and advertising costs.
4. Selling arrangements
  1. Problems arising from Cassis and early approaches by the Court
    1. Marketing conditions, did not create dual burden on imported goods but can
      1. Blesgen: even though a law on the marketing of products does not directly concern imports, it may, according to the circumstances, affect prospects for importing products from other member states and thus fall under the prohibition in article [34]of the Treaty. But here, It is to be observed in addition that the restrictions placed on the sale of the spirits in question make no distinction whatsoever based on their nature or origin. Such a legislative measure has therefore in fact no connection with the importation of the products and for that reason is not of such a nature as to impede trade between Member States.
      2. Oosthoek: urging someone to discontinue a marketing scheme that proves particularly effective may constitute obstacle to imports even if the legis applies equally to domestic and foreign products but must be justified under mandatory requirements
      3. Torfaen: Court adopted the view that the rules fell in principle within the scope of Article 34 TFEU and whether they could be justified under mandatory requirements
      4. Hünermund: “I consider that measures, whose subject is the manner in which trading activity is carried on, are in principle to be regarded as falling outside the scope of Article [34], inasmuch as they are not designed to regulate trade itself, and have no connection with the parity or disparity of the national laws in point and, moreover, are not liable to make access to the market less profitable for the operators concerned and thus, indirectly, to make access more difficult for the products in question.”
  2. The ruling in Keck
    1. Two issues: companies too eager to use art 34 in national courts + legal clarity in area needed
    2. Selling arrangements excluded from scope of art 34 where: 1) The measure applies to all affected traders in the national territory and 2) the measure does not either in law or in fact affect the marketing of domestic and imported goods
    3. Three criticisms: approach formalistic + Keck would be focal point for companies arguing that harder to access local market + discrimination-based analysis rather than obstacle-based
      1. Leclerc-Siplec
    4. Applying the Keck proviso
      1. De Agostini (Svenska) Förlag AB and TV-Shop i Sverige: Court prepared to recognise that some selling arrangements may still have disparate impact on imported goods so Cassis; television advertising was the only effective form of sales promotion enabling it to penetrate the Swedish market since it had no other advertising methods for reaching children and their parents. So outright ban aimed at children, not ok
      2. Deutscher Apothekerverband: for pharmacies not established in Germany, the internet provides a more significant way to gain direct access to the German market. A prohibition which has a greater impact on pharmacies established outside German territory could impede access to the market for products from other Member States more than it impedes access for domestic products
      3. Ker-Optika: selling on contact lenses over internet in Hungary prohibited for foreign sellers; legislation does not affect in same manner Hungarian traders and foreign traders so Keck proviso not satisfied
  3. Types of selling arrangements
    1. Dynamic MedienVertriebs: rules which restrict the marketing of products to certain points of sale + limit commercial freedom without actually affecting characteristics of produce => selling arrangement. Labelling of products.
    2. Tommaso Morellato: Italian rules demanding that partially baked bread to be packaged separately from baked bread. But 'good' not complete until final baking, rule was not additional burden but rule applied once production process complete
    3. Alfa Vita Vassilopoulos AE: legislation therefore constitutes a barrier to imports which cannot be regarded as establishing a selling arrangement as contemplated in Keck and Mithouard
Product use rules: rules that concern how a product is used
1. Commission v Italy (motorcycle trailers): prohibition laid down in Article 56 of the Highway Code, to the extent that its effect is to hinder access to the Italian market for trailers which are specially designed for motorcycles and are lawfully produced and marketed in Member States other than the Italian Republic, constitutes a measure having equivalent effect to quantitative restrictions on imports within the meaning of Article [30 TFEU], unless it can be justified objectively.
2. Mickelsson v Roos: prohibiting users from using something for specific intent and purpose for which product was designed
Export art 35
1. R v. Ministry of Agriculture, Fisheries and Food ex parte Hedley Lomas: UK restricted export licenses for the export of live cattle on the grounds that it was alleged that Spanish slaughterhouses were not in compliance with EU law
2. Groenveld v. Produktschap voor Vee en Vlees: difference in treatment between MS and outside, export
3. Gysbrechts and Santurel Inter: even if a prohibition such as that at issue in the main proceedings is applicable to all traders active in the national territory, its actual effect is none the less greater on goods leaving the market of the exporting Member State than on the marketing of goods in the domestic market of that Member State
Justifying measures
1. Distinctly applicable measures
  1. Commission v. United Kingdom (‘UHT Milk’): art 36 must be interpreted in such a way as not to extend its effects further than is necessary for the protection of the interests which it seeks to safeguard
2. Indistinctly applicable measures: mandatory requirements exceptions
  1. Cassis: fiscal supervision, the protection of public health ,the fairness of commercial transactions and the defence of the consumer.
  2. Commission v Denmark (recycling of bottles): protection of environment
  3. Cinéthèque: protection of MS' culture
  4. Justification requirements
    1. Determining that the measure is a QR or MEQR, distinctly applicable or indistinctly applicable
    2. Determining the public interest goal
    3. Evaluating the proportionality of the measure
    4. Protecting public health
      1. Officier van Justitie: MS authorize marketing when the addition of vitamins to foodstuffs meets a real need, especially a technical or nutrition alone
      2. Commission v Germany (Beer Purity): on additives
      3. Commission v Netherlands (Vitamins): if the real risk for public health alleged appears sufficiently established on the basis of the latest scientific data available at the date of the adoption of such decision
    5. Protecting public morality + policy
      1. Henn and Derby: for each member state to determine in accordance with its own scale of values and in the form selected by it the requirements of public morality in its territory.
      2. Conegate: cannot treat imported and domestic goods differently,
    6. Protecting consumers
      1. Estée Lauder: where a promotional description or statement is misleading; would the average consumer be misled?
      2. Verband: names or descriptions which mean something different in a particular country
    7. Fundamental rights
      1. Familiapress: A prohibition on selling publications which offer the chance to take part in prize games competitions may detract from freedom of expression. Article 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms does, however, permit derogations from that freedom for the purposes of maintaining press diversity, in so far as they are prescribed by law and are necessary in a democratic society
    8. Proportionality
      1. Konsumentombusmannen: national court must determine whether measures + prohibitions proportionate with objective sought
      2. Commission v Germany (Medical Hospital Supplies): In the light of the foregoing, the contested provisions must be considered to be justified on grounds relating to the protection of public health. ECJ does sometimes rule on proportionality

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