European Union Law Project - Essay Example

EU Law Project Name Course Lecture Introduction The Treaty on the Functioning of the European Union (TFEU) seeks to eliminate all obstacles to free trade within the European Union. The European Court of Justice (ECJ) is charged with enforcing the four freedoms guaranteed by the treaty including the freedom of free movement of goods. The ECJ however has to greatly consider whether any enforcement of the freedoms interferes with the sovereign authority of National governments to regulate trade within their territory. The ruling in Keck was an effort to balance the sovereign right of French authorities to regulate trade in their national territory and the need to allow free trade between EU member states. However, according to some scholars and Advocate Generals the ruling was faulty and was likely to impact free trade between member states in the future. Discussion The judgment in Keck tried to limit the applicability of Article 34 TFEU (28 EC). Under the judgment, the restriction and prohibition of certain selling arrangements was found not to hinder trade between member states as per the ruling in Procureur du Roi vs. Benoît and Gustave Dassonville 1. The Keck ruling set out that if such provisions affected all traders operating within the national territory the same way regardless of whether they are nationals or traders from other member countries then such provision could be exempted from Article 34 TFEU2. Thus Keck in effect created an exemption from Article 34 TFEU for some selling arrangements. Since article 34 states seeks to prohibit quantitative import restrictions and measures that have equal effect, the Keck ruling removed some selling arrangements from the ambit of Article 343. According to Spaventa, the Keck Judgement could assist national government pass measures that would effectively hinder imports between member countries while escaping the prohibition in Article 344. The judgment in Keck has become an area of great debate in academic and the judgment is often referred to in rulings touching on Article 34 TFEU. Keck clearly goes against the spirit of free movement of goods and trade that was the intention of the TFEU5. Earlier case like Cassis, the court was seen to oppose any measures that had the effect of restricting trade; however Keck is supportive of measure that restricts trade. The courts had reasoned that a measure only needed to be discriminatory in effect fo it to be prohibited. Cassis preferred member states to mutually recognize all restrictions6. Under Cassis, traders were free to circulate within the Union all goods that had been lawfully manufactured and produced in member states. In contrast, the Keck judgement means all goods that are to be sold at a loss cannot be distributed in France. In the joint cases; Alfa Vita Vassilopoulos AE, the Advocate General’s Poiares Maduro criticized the approach in Keck, and reasoned it has three major disadvantages7. First, the judgement in Keck gave rise to more uncertainty over the kind of measures which were beyond the scope of the freedom of free movement of goods as provided by TFEU. A rule on product characteristics is hard to distinguish from non-discriminatory selling arrangements as the distinction rises only through the method choosen to apply the rules and the actual effect of the rules in the market. Secondly, the courts finds that applying the Keck Case law to the area of free movement of goods is very complex8. This complexity has led the ECJ to refer cases which need the scope and nature a rule to be determined to national courts. Having already asked the ECJ to assist in determining the case, National courts find such a burden to be too heavy. Thirdly, the rule developed in Keck is not easily applicable to other freedoms of trade within the TFEU. The Advocate General argued that the ECJ had not previously applied the “selling arrangement” category in other cases touching on the other freedoms provided by the TFEU9. In fact, the ECJ still prefers the approach that recognizes all measures that impede, restrict or prohibit the freedom in question as discriminatory restriction. Therefore, most cases on the other freedoms appear to be inconsistent with Keck. This inconsistency is a greater problem as most national measures evaluated by the ECJ appear to be restriction on freedom of trade considered from the free trade spirit of the TFEU. The Keck ruling was obviously made on policy grounds10. It aim was to reduce the number of litigations and the extremes that result as a result applying the TFEU’s principle on free movement of goods. However, instead of simplifying the application of the principle, the judgment caused more uncertainty about exempted prohibitions. According to Gormley, the Keck and Mithouard judgment overruled the reasoning used in Oosthoek 11 series of judgements on selling arrangements including packaging the main product with free gifts12. The reasoning in Keck was also applied in Hunermund v Landesapothekerkammer Baden-Wurttenberg this further points the Oosthoek series of cases were no longer considered good law13. In this case the ECJ judged that the impact of the rule did not extend to trade between member states. The case concluded that rules that restrict marketing of products could not fall under the prohibition of Article 30, if they do not seek to distinguish the origin of products 14. Similarly, the ECJ in Tanstation 't Heukske vof and JBE Boermans and Punto Casa SpA v Sindaco del Commune di Capena used similar reasoning to exempt certain marketing arrangements from the ambit of Article 3015. The ECJ seems to be going against the basic principle on selling arrangements set out in Dassonville16. The Court seems to have made this ruling purely on policy grounds to avoid interfering with the autonomy of national authorities to regulate on social-economic issues17. In Punto Casa SpA v Sindaco del Commune di Capena and Others, the courts applied the same reasoning while ruling on Sunday trading restrictions18. In this case, Sunday trading rules were classified as selling arrangements which have similar effect on both domestic and foreign traders and thus do not fall under the prohibitions caught by Article 34. However, the complexity of applying the Keck Case law has seen the ECJ decide that most cases that are brought before are measures of equal effect19. In Dynamic Medien, the courts avoided ascertaining the selling arrangement status of a German law prohibiting internet sales of unclassified DVDs to young people20. Instead the court decided the prohibition was a measure that had the effect of limiting free movement of goods and therefore it violated Article 34. However, the court reasoned that such measures where justifiable as its aim was to protect children from violent or pornographic content21. Some Scholars however caution the ECJ from providing too many grounds to exempt restrictions on trade from prohibition as this has the unintended effect of restricting trade between member states which goes against the spirit of the TFEU22. According to Barnard the lack of a test to determine whether selling arrangement are discriminatory restrictions makes the applicability of Keck inconsistent23. According to Barnard, courts use a three-stage test while deciding whether a restriction violates Article 36. Alternatively the two stage test is applied. Under the two-stage test, the court first determines whether the national measure in question hinder, restricts of creates an obstacle to free movement of goods. Secondly, it determines whether it is appropriate to prohibit the measure under Article 36. Recently, the ECJ has adopted the market access test which considers all other measures that restrict products from a member country from accessing the market of member state as discriminatory. This indicates that the court has radically departed from the reasoning in Keck and is ready to overlook Member States regulatory freedom in an effort to protect the TFEU’s spirit of free trade24. As shown by the reasoning of Advocate General Jacobs in Société d'Importation Edouard Leclerc-Siplec v TF1 Publicité SA and M6 Publicité SA and Poiares Maduro in Alfa Vita Vassilopoulos AE, most Advocate Generals favour the market access test25. The market access test in effect means that any national measure that impacts the free movement of goods violates Article 3426. However, as seen earlier such a broad approach would significantly affect the sovereignty of member states over sensitive trade issues. It is clear nation states still need to control certain aspects of trade within their national territory and therefore the ECJ should take a case-by-case approach. Conclusion As trade gets more complex and advanced the ECJ needs to establish a consistent approach that determines whether selling arrangement or national regulations interfere with Article 34 and other articles of the TFEU that seek to protect free movement of trade among member nations. The ECJ should seek to establish refined case law that covers most modern aspects of trade such as purchasing over the internet. Putting consideration of national autonomy over fairness and the principle of free movement of goods may result in inconsistent and complex case law with a similar impact as Keck. Bibiography A. Article/ Books/Reports Barnard, The Four Freedoms (3rd edn, OUP, Oxford 2010) p. 10 Davies, G. ‘Understanding market access: exploring the economic rationality of different conceptions of free movement law’ (2010) 671 German LJ 11 E. Spaventa, ’Leaving Keck Behind? The Free Movement of Goods after the Rulings in Commission v Italy and Mickelsson and Roos’ (2009) 34(6) European Law Review 914 Gormley, L. W. (2007). Silver Threads among the Gold.. 50 Years of the Free Movement of Goods. Fordham Int'l LJ, 31, 1637. Snell, Jukka. "The notion of market access: a concept or a slogan?." COMMON MKT. L. REV. 47 (2010): 437 B. Case law Alfa Vita Vassilopoulos AE (C-158/04) and Carrefour Marinopoulos AE (C-159/04) Case 120/78, Cassis de Dijon, [1979] ECR 649 Dynamic Medien [2008] ECR I-505 Procureur du Roi vs. Benoît and Gustave Dassonville, ECR 1974 Punto Casa SpA v Sindaco del Commune di Capena and Others [1994] ECR I-2355 Société d'Importation Edouard Leclerc-Siplec v TF1 Publicité SA and M6 Publicité SA [1995] ECR I-179 Tanstation 't Heukske vof and JBE Boermans (case C-401/9 and case C-402/92 of ECJ, 2 June 1994); Read More