Free mov good Essay

The European Union had been facing problems for several years because of the fact that the national laws of its member states and their product necessities were different. Due to this, two important principles have emerged. One of these is the harmonization of the national legislation for products. Accordingly, the member states have compromised on the quality of the product if it was produced in accordance with the existing norms in the member states. This resulted in the applicability of common standards for a product among all the member states. This principle assured the free movement of goods in the EU markets. Moreover, protection at a higher level has been assured. Technical standards in the case of cars, toys and electrical goods have been harmonized. Due to this harmonization process of technical standards, the process of compromise between the member states has become more complicated. However, this procedure does not encompass all the products[1].

The other principle, which addresses this lacuna in the harmonization process, is mutual recognition. This principle is applicable to goods that had not been harmonized. Moreover, it constitutes an important principle upon which the free movement of goods are based[2].

The underlying principle of mutual recognition is that if a product is acceptable in one member country then the other member countries have also to accept it. Due to this principle, the member states should accept the goods produced according to the EU regulations and procedures, even though they are not compatible with their standards of requirement[3].

The principle of mutual recognition is embodied in the EC Treaty under Articles 28 – 30. This principle is so important that it will prevail over any member state laws or administrative procedures if they are not in accordance with it. However, there are some exceptions to this principle, namely, safeguarding the public health, environment, culture, etc. The member state that is claiming the overriding interest has to prove that the product does not satisfy its requirements and that they had not applied any stringent measures while coming to such a conclusion. Under such circumstances, the member state should not restrict import of the goods abruptly. The importer has to be instructed to label these goods in a suitable manner, prior to distribution in the local market. A member state that discovers that a product has not been properly labelled cannot stop its import immediately but will have to ask the other member state to label it properly.

In the First Sunday Trading case, the Advocate General suggested that the European Court of Justice should render Article 28 inapplicable to legislation that divides the market. However, this was turned down by the ECJ and the Advocate General opined that the ECJ should declare this unequivocally[4].

In Keck and Mithouard, it was argued that Article 28 had been contravened by the French law. It was the considered opinion of the ECJ that Article 28 does not permit quantitative restrictions and measures having equivalent effect between Member States. In this connection, the ECJ held that a measure had equivalent effect on quantitative restriction if it thwarted intra-Community trade[5].

In the Oberkriesdirecktor Des Dreises v. Handelsonderneming Moorman case, the Federal Republic of Germany refused to rescind its laws. According to these laws, all goods crossing its border had to be inspected thoroughly. The ECJ decided that Article 30 should not be invoked if harmonization of measures that protected animal and human health were already being implemented by EC directives. Consequently, the ECJ held that German legislation had breached Article 28.

Furthermore, in the German Beer case, the EC held that Germany had violated Article 28 as it had insisted that the word Bier was to be used only if certain ingredients were used to manufacture beer, whereas other Member States did not use all of these ingredients. Germany contended that some of the ingredients used by other member states were harmful. The ECJ opined that if the list of ingredients used were displayed on the container, then the consumer would have all the information about the product and that this would provide him with all the facts required to decide whether it was safe to consume that brand of beer or not. Hence, German law had infringed the principle of proportionality and it could not seek an exemption under Article 30.

Similarly, in the German Sausages case, German law had banned the sale of certain sausages in Germany. The additives in these sausages had not been proscribed in the country of their origin; hence, the ECJ decided that German law had infringed Article 28.

The EEC Treaty functions adequately only if there exist, first, the principle of equivalence, which requires all member states to harmonize their law as it guarantees the free movement of goods. Second, the Rule of Reason principle, whereby goods need not be allowed free movement if public health is at risk, commercial transactions are rendered unfair or the consumer is put to risk. However, this is applicable only if there is no relevant Community legislation. After Keck and Mithouard, free movement of goods is the norm at present. The principle of equivalence requires the member states to have a harmonization of law and its consequence is the free movement of goods.

In United Kingdom v. European Parliament and Council, [6] the UK requested the repeal of Regulation No 2065/2003 EC because; instead of harmonization, it only dealt with according sanction to smoke flavourings for food and therefore, Regulation 2065/2005 had to be adopted under Article 308 EC and not under Article 95 EC. The Court did not accept this contention and decided that the variation in the national laws in respect of smoke flavourings was proving to be detrimental to their free movement.

Hindrances to the single market like custom duty and import taxes are eliminated in the European Union. Nevertheless, several obstacles exist. These are in general related to the various requirements attached to the exported and imported goods in respect of size, labelling, etc. Considering the aspects of public safety and environmental protection, each nation put forth various demands on products. If a product is sold in only one state, it has to be compatible to the local standards. Necessity for the product differs from state to state. There are problems with the distribution of products in other countries regarding the standards that are prevalent there.

The outbreak of a viral attack in the Netherlands led to the prohibition of the import of all poultry products into the member states of the EU, in January 2003. Subsequently, due to the abatement of the disease in December 2003, this ban was set aside. However, the United Kingdom ignored this directive of the EU and continued to prevent Dutch poultry products from entering its territory.

Article 14 of the EC Treaty states that the internal market of the EU should be free from obstacles. Moreover, it should facilitate the free movement of products, workers, services and capital in accordance with its legislation. This Article also assures legal protection to the internal market in the EU.

There are three types of obstacles to the free movement of goods, namely, physical hurdles, technical hurdles and fiscal hurdles. Of these three types of hurdles, the technical barriers are of the greatest importance. This is because of the fact that such barriers obstruct the free movement of goods in the internal market.

In Commission of the European Communities v. Italian Republic,[7] the Italian Government restricted the import of a beverage consisting of caffeine, on the grounds that this content was above the permissible limit. However, the Italian Government was unable to establish that such a limit was required for safeguarding the public health. The court held that the Italian Republic had not been successful in discharging its duties under Articles 28 and 30 EC. A similar judgment was delivered in Commission v. Germany[8] and Commission v. Belgium[9].

In Procureur du Roi v. Benoit and Gustave Dassonvile[10], Rewe – Zentral (Cassis de Dijon)[11] and Franzein[12] cases  the court held that commercial stipulations promulgated by the member states are restricted by Article 28 EC if they obstruct the free movement of goods, since such restriction can be construed to be restrictions on the inter – community market. These cases reveal the state monopolies in respect of commercial transactions. Moreover, they disclose that restrictions on the import of products that are produced and sold according to the specifications of their respective nations constitute a breach of the provisions of the EC Law.

In EC Commission v. Denmark (Re Returnable Containers Case)[13], the Danish Government enacted legislation to the effect that its national environment protection agency was the only agency authorized to approve the packing of beer and soft drinks, which were to be sold in Denmark. The Commission instituted action against Denmark challenging this law. The court held that the condition that such restrictive approval constituted a violation of Article 30 EC and could not be justified under public policy requirements.

In Commission v UK (Re excise duty on wine), [14] the United Kingdom Authorities had levied higher taxes on wines than on beer. Wines in the United Kingdom are imported in the main, in comparison to beer, which is mainly brewed locally. The Commission initiated proceedings against the United Kingdom, contending that wine and beer being similar products the tax on them should also be the same. The European Court of Justice held that the United Kingdom had infringed the EC Treaty by imposing a higher tax on other member state products. In other words, this constitutes a restriction on the free movement of goods within the internal market.

In Commission v Italy (Re Export tax on Art Treasures)[15]  the Italian Government, in order, to thwart the export of valuable art objects levied a tax on their exports. The Commission initiated action against the Italian Government stating that this tax was tantamount to a prohibition and that such a restriction was in violation of the EC Treaty Provisions. The European Court of Justice concurred with the European Commission and opined that the tax was not lawful. It also suggested that the Italian Government could discourage the export and consequent loss of national treasures by resorting to other means.

In our present problem, the outbreak of virus had been investigated by the EU Commission for a period of nine months. Subsequently, the Commission concluded that the threat posed by the virus had abated. Accordingly, the Commission removed the ban on poultry product imports from the Netherlands. This attitude of the United Kingdom clearly indicates its unwillingness to comply with the decision of the Commission. This constitutes a violation of the provisions of Community Law. The United Kingdom can only justify its decision by proving that the requirements of public policy are violated by the Commission’s decision.

The breach of the principle of mutual recognition is depicted under such circumstances where the member states are not agreeable to the quality of the products that had been tested by a competent authority designated by the EC for that purpose. In our present problem, the United Kingdom had prohibited the Dutch imports suspecting their quality. This clearly indicates that the United Kingdom had violated the principle of mutual recognition. In some instances, the requirement in respect of the quality of the products has not been specified in the regulations of the member states.

The product should not prove harmful to the public at large[16]. The principal of mutual recognition states that products should be allowed to move freely in the member states.

In a similar case, namely Commission v UK[17] the UK government in response to the lobbying of poultry producers banned the import of poultry products. The reason given by the UK Government for this ban was that such imports were against the public policy, in as much as these imports could result in the poultry disease infecting the domestic fowls. The European Court of Justice held that this was unjustified because there were several other options available to the United Kingdom Government that were less restrictive in nature.

Hence, the principle of mutual recognition reiterates the fact that a product that was produced and sold as per EU Regulations and Standards in other member states cannot be rejected. Since, the investigations were held on the product by the EC Commission for nine months, the quality of the product cannot be suspected by any member state. Moreover, the product had been imported by the other member states subsequent to the removal of the ban by the EC. Thus, the Netherlands is well within its rights in lodging a complaint with the Commission regarding the infringement of EC Law by the United Kingdom.

BIBLIOGRAPHY

1.                   Bernard, “Sunday Trading: A Drama in Five Acts”, (1994), 57 MLR 449.

2.                   C-178/84, Commission v. Federal Republic of Germany, 1987 E.C.R. 1227, [1988] 1 C.M.L.R. 780.

3.                   C – 40/82. Commission v UK.

4.                   C – 7/68. Commission v Italy (Re Export tax on Art Treasures).

5.                   C – 170/78. Commission v UK (Re excise duty on wine).

6.                   C – 420/01. Commission of the European Communities v. Italian Republic (2003) ECR I-6445.

7.                   C – 476/98. Commission v. Germany.

8.                   C – 8/74. Procureur du Roi v. Benoit and Gustave Dassonvile.

9.                   C – 120/78 Rewe – Zentral (Cassis de Dijon).

10.               C – 189/95 Franzein.

11.               C – 302/86 Commission v. Denmark (Re Returnable Containers Case).

12.               C – 122/02. Commission v. Belgium.

13.               Case C-66/04 United Kingdom v. European Parliament and Council (2005) ECR I-10553.

14.               Directive 2001/95/EC Treaty.

15.               German Sausages case.

16.               Keck & Mithouard, Joined Cases C-267 & 268/91, (1993) ECRI-6097.

17.               Schreib, David. Different national product requirements are one of the main obstacles to the free movement of goods in the EU. Retrieved from http://www.mpo.cz/dokument12653.html

[1] Schreib, David. Different national product requirements are one of the main obstacles to the free movement of goods in the EU. Retrieved from http://www.mpo.cz/dokument12653.html
[2] Ibid.
[3] Ibid.
[4] Bernard, “Sunday Trading: A Drama in Five Acts”, (1994), 57 MLR 449

[5] Keck & Mithouard, Joined Cases C-267 & 268/91, (1993) ECRI-6097
[6] Case C-66/04 United Kingdom v. European Parliament and Council
[7] C – 420/01.
[8] C – 476/98.
[9] C – 122/02.
[10] C – 8/74.
[11] C – 120/78.
[12] C – 189/95.
[13] C – 302/86.
[14] C – 170/78.
[15] C – 7/68.
[16] Directive 2001/95/EC.
[17]  C –  40/82.