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Gottwald Case C-103/08

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of 1 October 2009 [.of the Court, First Chamber] in Case [C-103/08] Arthur Gottwald v Bezirkshauptmannschaft Bregenz  [2009] ECR Page I-09117

 

Referred by [Unabhängiger Verwaltungssenat des Landes Vorarlberg – Austria]

 

 

FACTS:

Mr Gottwald is a German national resident in Hamburg (Germany) who suffers from complete paraplegia with the loss of all functions below the fourth vertebra. A severe-disability identification card was issued to him in Germany.

On 26 August 2006, Mr Gottwald was driving his vehicle on the Austrian toll motorway network, on his way to his holiday location in Austria. He was subject to a roadside check and it was ascertained that he had not paid the time-dependent toll by purchase of a toll disc to be affixed to his vehicle.

The Bezirkshauptmannschaft Bregenz therefore imposed a fine of EUR200 on him, by decision of 4 December 2006, against which Mr Gottwald appealed before the Unabhängiger Verwaltungssenat des Landes Vorarlberg (Independent Administrative Tribunal of the Province of Vorarlberg).

In that appeal, Mr Gottwald submitted, in particular, that, since he suffers from paraplegia in respect of which he has been issued with a German disabled person’s card, he is entitled to be issued with a toll disc free of charge in Austria, pursuant to Paragraph 13(2) of the Austrian law, on the same basis as disabled persons resident or ordinarily resident in Austria.

 

ISSUES/QUESTIONS:

 Freedom of movement for persons – Citizenship of the Union – Article 12 EC – Issue of an annual toll disc in respect of a motor vehicle free of charge to disabled persons – Provisions restricting the issue of that disc to disabled persons resident or ordinarily resident in national territory/ Is Article 12 TEC, now Article 18 TFEU, to be interpreted as precluding national legislation, such as that in question in the main proceedings, which restricts the issue of an annual toll disc free of charge to disabled persons who are resident or ordinarily resident in the territory of the Member State concerned.

 

ANSWER of the COURT:

Article 12 EC must be interpreted as meaning that it does not preclude a national rule, such as that at issue in the main proceedings, which restricts the issue of an annual toll disc free of charge to those disabled persons who are resident or ordinarily resident in the territory of the Member State concerned, including also those persons who regularly travel to that State for professional or personal reasons.

 

REASONING of the Court

 

First the Court ruled on the admissibility of the reference for a preliminary ruling. The Austrian Government challenged the admissibility on the ground that it is of a purely hypothetical nature and is irrelevant to the outcome of the dispute in the main proceedings, since Mr Gottwald has never made an application in Austria for the free toll disc in question, as the national rules provide, in order to obtain the relevant annual toll disc, free of charge. This argument was not accepted and the Court stated that the interpretation sought by the national court might be useful for the outcome of the action in the main proceedings, as the national court has the power to reduce the fine, in case Mr. Gottwald was discriminated on grounds of nationality, even if he did not apply for the annual disc toll, free of charge.

Then the Court recalls that citizenship of the Union is the basis for nationals of Member States, which find themselves in situations similar to nationals of the Member State concerned, to be treated the same way. As a consequence every EU citizen can rely on Article 12 TEC, now Article 18 TFEU. As the applicant in the main proceedings exercised his rights to move and reside within the territory of the Member States in order to take holidays in another Member State, has the right, set out in Article 12 EC, not to suffer discrimination by reason of his nationality.

Considering the fact that the Austrian rules restricts availability of the free annual toll disc only to those disabled persons who are resident or ordinarily resident in Austria, the Court found this to be indirectly discriminatory, which can be justified only by objective considerations independent of the nationality of the persons concerned and is proportionate to the legitimate aim of the national provisions.

The legitimate aims invoked by the Austrian Government, the promotion of mobility and integration of disabled persons and the wish to ensure that there is a connection between the society of the Member State concerned and the recipient of a benefit such as that at issue in the main proceedings, are to be considered as objective considerations of public interest which are capable of justifying the fact that the conditions for the grant of the benefit may affect the freedom of movement of the citizens of the Union.

As regards the proportionality test, the Court recalled that in order for a national measure to be proportionate, it must not go beyond what is necessary in order to attain that legitimate aim. Then the Court dealt with the integration issue and stated that when such benefits are not covered by EU law, Member States’ discretion is wide in deciding which criteria are to be used when assessing the degree of connection to society. In this respect, the Court made reference to Cases Bidar and Forster[1]. As the national rules at matter do not contain additional conditions for the granting of the annual free of charge toll, like a minimum period during which the person concerned must have been resident or ordinarily resident in Austria, the Court found that the measure is justified.

 

Comments:

 

The Court followed the Opinion of the Advocate General Mazak in the Case. It is worth to note, his approach. In this respect, he considered that the issue brought before the Court should be interpreted, as per the Commission opinion, in the light of Article 12 TEC and 49 TEC, now Articles 18 and 56 TFEU. Mr. Gottwald was regarded as recipient of services under the Treaty provisions, which lays down specific conditions for the applicability of the principle of non-discrimination.

The Court assessment in relation to the principle of non-discrimination followed the “classical” steps, meaning that it started from the principle of equal treatment, which s a fundamental principle of EU law. After noted that the residence criteria constitutes discrimination on grounds of nationality and breaches the equal treatment rule, the Court assessed if the restrictive measure can be justified, namely if it is proportionate and not goes beyond what is necessary. Finding that it is proportionate to the legitimate aim and does not go beyond what is necessary, the Court ruled that the national measures at issue do not fall under Article 12 TEC, now Article 18.

 

It is clear from the Courts’ settled case-law, that the issue of integration, the link between the individual and the host society, is of most importance. In this respect, Court interpretation of the term integration applies on a case by case analysis. In this case, the residence criterion was found to be indirectly discriminatory, and justified also by the fact that it does not contain a “minimum stay” additional condition. Unlike in Forster, where the Court found the minimum stay condition was a proof of the link between the applicant and the host society, reasoned by the fact that the Dutch rules contained a formal definition of “Integration”, here the Court used this argument, the lack of a minimum stay condition, to rule that this kind of discrimination is to be accepted under EU law. Moreover, reference to Cases Bidar and Forster was made, which are two different Judgments, in relation to the discrimination issue, but the integration matter is a common one, with different interpretation tough, in the sense that what is considered discriminatory in Forster, is not considered the same in Bidar.

To reach these different outcomes, the Court assessed the matter of equal treatment in the light of the integration, stating, in simple words, that when an individual is not financially linked with the host society, the respective Member State is entitled by EU law to discriminate against the non-integrated ones.

This Case maybe should have been assesses from the principle of legal certainty standpoint also. The principle of legal certainty is a fundamental principle of Community law which requires, in areas covered by Community law, that the Member States’ rules should be clear and precise, so that individuals may be able to ascertain unequivocally what their rights and obligations are. It aims to ensure that situations and legal relationships governed by Community law remain foreseeable. In this situation, did Mr. Gottwald knew what rights (to apply for a free of charge toll road, under Articles 18, 21 and 49 TFEU) and obligations are incumbent to him as a EU citizen? How is in Germany then? Does he own a free of charge annual road tool there? As the AG and Commission stated, as a recipient of services in his capacity as a tourist, being temporarily in Austria, Mr. Gottwald was discriminated on grounds of nationality.



[1] Case [C-103/08] Arthur Gottwald v Bezirkshauptmannschaft Bregenz  [2009] ECR Page I-09117, paragraph 25.

 

Wolzenburg -Case C-123/08

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of 6 October 2009 [.of the Court Grand Chamber] in Case [C‑123/08] Dominic Wolzenburg, [2009]  ECR I-09621

Referred by [Rechtbank Amsterdam (Netherlands)]

 

 

FACTS:

 

In fact, Dominic Wolzenburg, a German national, was given a suspended custodial sentence of one year and nine months in respect of a number of offences. After he had left Germany to live in the Netherlands, the German court decided to revoke the conditional suspension of the sentence on the ground that Mr Wolzenburg had infringed the conditions under which he benefited from that suspension. Accordingly, the German issuing judicial authority issued a European arrest warrant against him and requested the Netherlands executing judicial authority to surrender Mr Wolzenburg for the purpose of enforcing the now final custodial sentence.

 

The Netherlands legislation implementing Framework Decision 2002/584/JHA provides that the surrender of a Netherlands national for the purposes of execution of a custodial sentence imposed by final judicial decision will be refused. However, for nationals of other Member States, such a refusal is subject to the condition that they have lawfully resided in the Netherlands for a continuous period of five years and that they are in possession of a residence permit of indefinite duration.

 

The Framework Decision on the European arrest warrant[1]provides that Member States are, in principle, obliged to act upon a European arrest warrant. Nevertheless, in certain situations, the executing judicial authority may refuse to surrender a requested person.

 

 

ISSUES/QUESTIONS:

 

Police and judicial cooperation in criminal matters – Framework Decision 2002/584/JHA – European arrest warrant and surrender procedures between Member States – Article 4(6) – Ground for optional non-execution of the European arrest warrant – Implementation in national law – Person arrested a national of the issuing Member State – Non-execution of the European arrest warrant by the executing Member State conditional upon the person having spent a period of five years in its territory – Article 12 EC/Is a national of one Member State who is lawfully resident in another Member State entitled to rely on the first paragraph of Article 12 EC, ex Article 18 TFEU, against national legislation, such as the Dutch one, which lays down the conditions under which the competent judicial authority can refuse to execute a European arrest warrant issued with a view to the enforcement of a custodial sentence? How is Article 4(6) of Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States to be interpreted in relation to the national rules?. Is it contrary to Article 18 TFEU to have in force national rules that provides for different treatment of Netherlands nationals and nationals of other Member States with regard to refusal to execute a European arrest warrant?

 

ANSWER of the COURT:

 

A national of one Member State who is lawfully resident in another Member State is entitled to rely on the first paragraph of Article 12 EC against national legislation, such as the Law on the surrender of persons (Overleveringswet), of 29 April 2004, which lays down the conditions under which the competent judicial authority can refuse to execute a European arrest warrant issued with a view to the enforcement of a custodial sentence.

Article 4(6) of Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States must be interpreted as meaning that, in the case of a citizen of the Union, the Member State of execution cannot, in addition to a condition as to the duration of residence in that State, make application of the ground for optional non-execution of a European arrest warrant laid down in that provision subject to supplementary administrative requirements, such as possession of a residence permit of indefinite duration.

Article 12 EC, now Article 18 TFEU is to be interpreted as not precluding the legislation of a Member State of execution under which the competent judicial authority of that State is to refuse to execute a European arrest warrant issued against one of its nationals with a view to the enforcement of a custodial sentence, whilst such a refusal is, in the case of a national of another Member State having a right of residence on the basis of Article 18(1) EC, now Article 21 TFEU, subject to the condition that that person has lawfully resided for a continuous period of five years in that Member State of execution.

 

REASONING of the Court

 

First of all, the Court recalls that, in accordance with the Directive on residence of citizens of the Union[2], such citizens who have resided legally for a continuous period of five years in the host Member State are to have the right of permanent residence there. The Directive, while allowing citizens of the Union to apply for a document attesting to their permanent residence in the host Member State, does not require such a formality. Consequently, the Court rules that the Member State of execution cannot, in addition to a condition as to the duration of residence in that State, make application of the ground for non-execution of a European arrest warrant subject to supplementary administrative requirements, such as possession of a residence permit of indefinite duration.

Next, the Court examines, on the basis of Article 12 EC (the principle of non-discrimination) the compatibility of the Netherlands legislation which provides for nationals of other Member States who have not resided for a period of five years in its territory to be treated differently from its own nationals.

The Court recalls that the European arrest warrant is based on the principle of mutual recognition and that although, generally, Member States are obliged to act on a request issued by a judicial authority of another Member State, they nevertheless retain, when implementing the grounds for optional non-execution, a certain margin of discretion.

To be compatible with Community law, a difference in treatment based on nationality must be objectively justified, proportionate to the objective pursued and must not go beyond what is necessary to achieve that objective.

The Court considers that the ground for optional non-execution has in particular the objective of enabling the executing judicial authority to give particular weight to the possibility of increasing the requested person’s chances of reintegrating into society when the sentence imposed on him expires. The Member State of execution is therefore entitled to pursue such an objective only in respect of persons who have demonstrated a certain degree of integration in the society of that Member State. In the present case, the single condition based on nationality for its own nationals, on the one hand, and the condition of residence of a continuous period of five years for nationals of other Member States, on the other, may be regarded as being such as to ensure that the requested person is sufficiently integrated in the Member State of execution.

Furthermore, the Court considers that a condition requiring residence for a continuous period of five years for nationals of other Member States cannot be considered to be excessive having regard, in particular, to the requirements of integration.

The Court points out in that regard that Community legislation on the right of residence has expressly laid down the condition of residence for a continuous period of five years as precisely the length of time beyond which citizens of the Union acquire a permanent right of residence in the host Member State. Next, it finds that a requirement for residence such as that provided for by the national legislation in question, does not go beyond what is necessary to attain the objective of ensuring that persons who are nationals of other Member States achieve a degree of actual integration in the Member State of execution.

 

The Court concludes that Article 12 EC (the principle of non-discrimination) does not preclude the legislation of a Member State of execution under which the competent judicial authority of that State is to refuse to execute a European arrest warrant issued against one of its nationals with a view to the enforcement of a custodial sentence, whilst such a refusal is, in the case of a national of another Member State having a right of residence as a citizen of the Union, subject to the condition that the person has lawfully resided for a continuous period of five years in that Member State of execution.

 

Comments:

 

The Court noted the basis on which the Framework Decision 2002/584 was adopted, namely on EU Treaty and not EC Treaty, where the latter contains the prohibition on ground of nationality[3]. Although, the principle of non discrimination is an expression of the principle of equal treatment, which is a fundamental value of EU law. As a consequence, the Court assessed the issue of discrimination in the light of the freedom of every citizen to reside and move within the European Union. Mr. Wolzenburg is a German national, but a EU citizen, so that he can rely on the provision of EC Treaty as regards the right to move reside and he is protected from any discrimination on grounds of nationality.

The Court made an exact appliance of the Forster formula, by recalling that discrimination on grounds of nationality can be justified in relation to the degree of integration into the host society. In this respect, the Court stated that the two conditions contained in the Dutch rules, namely that the single condition based on nationality for its own nationals, on the one hand, and the condition of residence of a continuous period of five years for nationals of other Member States, on the other, may be regarded as being such as to ensure that the requested person is sufficiently integrated in the Member State of execution[4].

As regards the proportionality test, just like in Forster, the Court merely stated that the measure fulfills the four conditions of justification in relation to the degree of integration of the individual into the host society of the Member State of execution.

 



[1] Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States

[2] Directive 2004/38/EC of the European Parliament and of the Council of 29 April 2004 on the right of citizens of the Union and their family members to move and reside freely within the territory of the Member States

[3] Case [C‑123/08] Dominic Wolzenburg, [2009]  ECR I-09621, paragraph 43.

 

[4] Idem, paragraph 68.

ČEZ- Case C-115/08

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (661 Comments)

Ruling of [27 October 2009] of the Court (Grand Chamber) in Case C-115/08 Land Oberösterreich v ČEZ as  [2009] ECR  I-10265

 

 Referred by Landesgericht Linz – Austria

 

 

FACTS:

 

In Austria an owner of land may prohibit his neighbour from causing nuisance, emanating from the latter’s land, in so far as it exceeds normal local levels and significantly interferes with the usual use of the land. However, if the interference is caused, in excess of that level, by an officially authorised installation on the neighbouring land, the landowner is entitled only to bring court proceedings for compensation for the damage caused.

 

The Land Oberösterreich (Province of Upper Austria) is the owner of land used for agriculture and agricultural trials, on which there is an agricultural college. The land is situated about 60 km from the Temelín nuclear power plant, which itself is situated in the Czech Republic and operated by the Czech energy company, ČEZ. The construction and operation of that nuclear power plant were authorised by the Czech authorities in 1985 and it has been operating at full capacity since 2003.

 

According to the Land Oberösterreich, the radioactivity generated by the normal functioning of the Temelín nuclear power plant or the risk of contamination caused by the operation and potential malfunction of the plant cause a lasting interference with the normal use of its land.

 

For that reason, the Land Oberösterreich and other private owners applied to the Landesgericht Linz (Regional Court, Linz), seeking an order that ČEZ put an end to the actual or potential nuisance relating to the ionising radiation potentially emanating from the Temelín nuclear power plant and adapt it according to the prevailing technical standards or close it if the required adaptations cannot be made.

 

The Austrian court found that, in Austria, there is discrimination between industrial installations which have been granted official authorisation by the national authorities and those which have been granted authorisation by the authorities of another Member State in that authorisations granted by the latter are not taken into account in an action for cessation of nuisance brought against their owner.

 

 

ISSUES/QUESTIONS:

 

Can an industrial activity consisting in the operation of a nuclear power plant may be pursued and, if so, what are the technical conditions which may be imposed on such a power plant because of an actual or potential nuisance allegedly caused to land situated in another Member State due to its possible exposure to ionising radiation originating from that power plant[1]?/ Does the principle of prohibition on grounds of nationality precludes, within the scope of the EAEC Treaty, the application of the legislation of a Member State such as that in the main proceedings?

 

ANSWER of the COURT:

 

The Austrian courts, when hearing an action for cessation of nuisance between neighbouring landowners and the Temelín nuclear power plant, must take account of the operating authorisation granted by the Czech authorities, as that authorisation is part of the Community system aimed at ensuring protection of the population against nuclear hazards.

 

REASONING of the COURT:

 

The Court finds, first of all, that the industrial activity pursued at the Temelín nuclear power plant falls within the scope of application of the EAEC Treaty.[2]

 

Next, the Court observes that undertakings which operate an installation situated in a Member State are usually undertakings established under the law thereof and that their situation is comparable to that of a national of that Member State. Consequently, a difference in treatment which works to the detriment of installations which have received official authorisation in a Member State other than Austria must be regarded as a difference in treatment on grounds of nationality. Moreover, the principle of prohibition of any discrimination on grounds of nationality is a general principle of Community law which is also applicable under the EAEC Treaty.

The Court notes that under the EAEC Treaty the Community possesses legislative competence to establish, for the purpose of health protection, an authorisation system which must be applied by the Member States. The granting of official authorisations for the construction and operation of nuclear installations, in their various aspects relating to health protection against the dangers of ionising radiations for the general public, therefore comes within the scope of application of the EAEC Treaty. It follows that a difference in treatment which works to the detriment of nuclear installations which have received official authorisation in another Member State must be examined in the light of that treaty.

 

Next, the Court notes that aims of a purely economic nature, such as protection of the interests of domestic economic operators, cannot justify discrimination on grounds of nationality.

The Court observes, in particular, that basic standards for health protection for the general public against the dangers arising from ionising radiations have been adopted at Community level, compliance with which at Temelín was checked by the Commission following the accession of the Czech Republic. Moreover, the questions relating to safety at that power plant were evaluated by the Commission and were the subject-matter of recommendations and monitoring by the Commission, with a view to bringing it up to a level of nuclear safety comparable to that prevailing in the European Union. Moreover, member States cannot enact a domestic provision which prevents an action for an injunction to prevent an actual or potential nuisance from being brought when the alleged nuisance is originated from an officially authorized industrial installation[3].

 

The Court further states that, in the event of malfunction of the protection system introduced under the EAEC Treaty, the Member States have a number of remedies at their disposal for obtaining the corrections necessary in the circumstances.

The Court dealt extensively with the discrimination matter, founding that even if the EAEC Treaty does not contain any express provision which corresponds to Article 12 TEC, now Article 18 TFEU, the principle of non-discrimination is part of the EU legal order and the rule on the ”on equal treatment with nationals is one of the fundamental legal provisions of the Community (see, inter alia, Case 2/74 Reyners [1974] ECR 631, paragraphs 15 and 24)”. Making reference to its previous case-law, the Court reiterated that the principle of non- discrimination is part of the EU legal order and the rule on the ”on equal treatment with nationals is one of the fundamental legal provisions of the Community (see, inter alia, Case 2/74 Reyners [1974] ECR 631, paragraphs 15 and 24)”. Making reference to its previous case-law, the Court reiterated that the principle of non-discrimination, as enshrined by Article 12 TEC, now Article 18 TFEU, is an expression of the general principle of equality, which itself is one of the fundamental principles of EU law[4].

 

Comments:

 

It is very interesting to note the difference with which the Case was approached by the Advocate General Maduro in comparison with the Court. In this respect, AG suggested in his Opinion, after dealing extensively with the interpretation of Article 43 TEC, now Article 49 TFEU, that the Court should not rule on the interpretation of provisions related to discrimination and quantitative restrictions. He considered that the main issue in the Case brought before the EU Court, consists in the applicability of freedom of establishment, as enshrined by the Treaty. As a consequence he “granted”, it seems, more discretion to the Member State, Austria, by stating that “The administrative authorisations of other Member States may be refused recognition if such a refusal is non-discriminatory in nature and is properly justified on grounds of public policy, public security or public health and provided that proper account is taken of compliance with relevant Community rules and the interests of all affected parties”.

In respect to the rules that form the principle of equal treatment, which state that comparable situations must not be treated differently and that different situations must not be treated in the same way,  the Court made their appliance to the issue, by reminding that when the 2004 EU enlargement took place and ten more States acceded , the questions relating to safety at the power plants in those States, including the Temelín nuclear power plant, were evaluated by the Commission, which led to the drafting of Community recommendations for improvements to those reactors in order to bring them up to a level of safety comparable to that prevailing in the European Union for comparable reactors, the implementation of which has been monitored by the Commission and the Council. It is well known from the EU case law, as regards the principle of equal treatment which governs the principle of non-discrimination, that comparable situations must not be treated differently and that different situations must not be treated in the same way (see, inter alia , Case C-354/95 National Farmers’ Union and Others [1997] ECR I-4559, paragraph 61). Such treatment may be justified only if it is based on objective considerations independent of the nationality of the persons concerned and is proportionate to the objective being legitimately pursued (see, inter alia , D’Hoop , [2002], ECR I-06191 , paragraph 36). The Court reiterated that the EU institutions, the Commission and Council, complied and promoted this fundamental value and as in a mutually binding contract, it is for the Member States to comply with their obligations in the same manner. As a result, a Member State cannot enact a domestic provision which prevents an action for an injunction to prevent an actual or potential nuisance from being brought when the alleged nuisance is originated from an officially authorized industrial installation. Moreover, that Member State cannot, in principle, exclude from the scope of application of such a provision authorisations granted in respect of nuclear installations situated in other Member States by maintaining that such an exclusion is justified on grounds of protecting life, public health, the environment or property rights. The natural consequence, was found to be that such an exclusion cannot be regarded as necessary for the purposes of protection and therefore cannot be held to satisfy the requirement of proportionality.

One can conclude from this ruling, that the principle of equal treatment requires mutual identy as regards the rights, but also the obligations, amongst Member States.

 



[1] Case [115/08], Land Oberösterreich v ČEZ as, ECR [2009] reference I-10265, paragraph 82.

[2] Treaty establishing the European Atomic Energy Community

[3] Case [115/08], Land Oberösterreich v ČEZ as, ECR [2009] reference I-10265, paragraph 135.

[4] Case [115/08], Land Oberösterreich v ČEZ as, ECR [2009] reference I-10265, paragraph 89.

Josemans -Case C-137/09

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of of the Court [Second Chamber] in Case C-137/09, Marc Michel Josemans v Burgemeester van Maastricht, [2010] ECR I-0000

 

Referred by [Raad van State (Netherlands)]

 

 

FACTS:

 

In fact, the Municipal council of Maastricht issued on December 20, 2005 a regulation that prohibited any coffee-shop owner from admitting to his establishment persons who do not have their actual place of residence in the Netherlands.

 

Mr. Josemans, the plaintiff in the main proceedings, was the owner of a coffee-shop, that was closed by a Mayors’ decision, in 2006, given the fact that he admitted persons that ware non-resident in the Netherlands, in to his establishment.

First he lodged an objection against that decision, that was dismissed. As a consequence he brought an action before the Maastricht Court (Rechtbank Maastricht) challenging the decision, on grounds that the respective regulation is contrary to EU law. He argued that that the legislation at issue in the main proceedings constitutes unjustified unequal treatment of citizens of the European Union and that, more specifically, people who are not resident in the Netherlands are denied the possibility of buying non-alcoholic beverages and food in coffee-shops. This Court annulled and revoked the decision of 2006, on grounds based on Constitutional provisions, namely that Article 1 of the Netherlands Constitution stipulates that nationality  discrimination is prohibited. The Court did not consider that the issue brought before it constitutes an infringement of EU law.

 

Not being satisfied with this solution, Mr. Josemans and the Mayor of the municipality of Maastricht appealed this decision before the Council of State, arguing that it is a matter of EU law and disputing the interpretation of the Netherlands Constitution.

 

 

ISSUES/QUESTIONS:

 

Interpretation of Articles 12 EC, 18 EC, 29 EC and 49 EC – Drug tourism – General municipal regulation prohibiting the admission of non-residents to coffee-shops selling narcotic drugs – Public order – Different treatment /Is the contested regulation is compatible with the provisions of the Treaty, as regards the freedom of goods and or services, which are governed by the principle of non-discrimination?

 

ANSWER of the COURT:

 

 In the course of marketing narcotic drugs which are not distributed through channels strictly controlled by the competent authorities with a view to use for medical or scientific purposes, a coffee-shop proprietor may not rely on Articles 12 EC, 18 EC, 29 EC or 49 EC to object to municipal rules, such as those at issue in the main proceedings, which prohibit the admission of persons who are non-resident in the Netherlands to such establishments. As regards the activity of marketing non-alcoholic beverages and food in those establishments, Article 49 EC et seq. may be relied on by such a proprietor.

Article 49 EC must be interpreted as meaning that rules such as those at issue in the main proceedings constitute a restriction on the freedom to provide services laid down by the EC Treaty. That restriction is, however, justified by the objective of combating drug tourism and the accompanying public nuisance.

 

REASONING of the Court

 

 The Court noted that there is a tolerance policy regarding the sale of cannabis within the Netherlands, under the conditions of limited quantity and control by the authorities. Coffee-shops are classified as catering establishments, where cannabis is sold and consumed in the same way as non-alcoholic beverages and food, alcoholic beverages being prohibited.

 

On a related note, the sale of non-alcoholic beverages and food in coffee-shops, is secondary to the trade of narcotics or is it that non-residents buy them in order to export them to their state of residence, as they do with the cannabis?  The Court did not accept the argument stating that the sale of other products within coffee-shops, except cannabis, is secondary, because the economic activity related to them is worth taking into consideration, and Mr. Josemans’s establishment fits in these coordinates[1].

Next, the Court decided to assess the case in the light of freedom of movement  of services, which is closely linked to the freedom of goods and answers  that there is a restriction on the exercise of that freedom insofar as the proprietors of coffee-shops are not entitled to market lawful goods to persons residing in other Member States and those persons are precluded from enjoying such services (see para 54).

After the Court asserted that there is a restriction related to the freedom to provide services that does not fall within the scope of Article 35 TFEU (restrictions on export), went on and assessed if there is a justification of the respective measure.

The Court agreed with the Netherlands Government, that combating drug tourism and the accompanying public nuisance is part of combating drugs, as it concerns both the maintenance of public order and the protection of the health of citizens, at Member State level and at EU level.

The information provided by the Netherlands’ authorities that there are 14 coffee-shops in the municipality of Maastricht which attract around 10 000 visitors per day, that is to say a little more than 3.9 million visitors per year. Of those visitors, 70% are not resident in the Netherlands, had also a considerable impact on the Court Judgment.

As a consequence, the objectives invoked by the Netherlands Government, namely combating drug tourism and the accompanying public nuisance are legitimate aims that constitutes justification for the contested restriction, even under a fundamental freedom such as the freedom to provide services.

Related to the adoption of less restrictive measures for achieving the same legitimate aims, the Mayor of Maastricht and the Netherlands Government stated that other measures  have been implemented to combat drug tourism and the accompanying public nuisance, that have proved to be insufficient and ineffective in the light of the objective pursued[2].

Moreover, the Court stated that the rules in question do not preclude a person who is not resident in the Netherlands from going, in the municipality of Maastricht, into other catering establishments in order to consume non-alcoholic beverages and food. According to the Netherlands Government, there are more than 500 such establishments (see paragraph 79 of the Judgment).

In its ruling the Court considered that the prohibition on admitting non-residents to coffee-shops, constitutes a measure capable of substantially limiting drug tourism and, consequently, of reducing the problems it causes.

 

Comments:

 

It is clear that when assessed the Case, the Court found that issue brought before it falls under the provisions of freedom to provide services[3], only in respect to the non-alcoholic beverages and food that are being marketed in coffee-shops. As this Treaty provision stipulates the principle of non- discrimination, the Court decided that regulations on the general principle of non-discrimination, Article 18 does not apply. In respect to EU citizenship provisions, the Court took note of the Commission’s argument and did not rule on the interpretation of Article 21, reasoning that non-residents of the Netherlands thatwant to consume lawful goods in a Coffee Shop in Maastricht, can relay also on the freedom to provide services, as they are to be regarded as persons for whom the services “are intended”, according to Article 56 TFEU.

 

Its worthnoty the difference between goods that was made the Court, when assessed the principle of non-discrimination that governs the freedom of services, namely lawful and, by contrast, unlawful ones[4]. Also, within the hierarchy of the four freedoms guaranteed by the Treaty, seems that the free movement of goods is entirely secondary to that of the freedom to provide services and may be considered together with it. The Court “gently circumvented” to rule on the drugs regime, in which it has no competence of course, but applied the principle “ Accessorium sequitur principalae”, where the freedom to provide services was given primacy. This stand was also taken by the Advocate General Bot, in his Opinion, at point 105. We could conclude that the general principle of non-discrimination applies only to the “lawful“ services and goods. According to AG Bot, the aim of the freedoms guaranteed by the Treaty is not ultimately intended to cover all commodities which may be evaluated on the market and all services which may be offered on the market, irrespective of their lawfulness and the commitments made by the Member States. This means that not express derogations from these freedoms are to be accepted, in respect to the lawfulness of the subject of the freedom. This means that the general principle of non-discrimination has its limits? One could answer yes. But then if the limits are imposed by the lawfulness of a product or, better said service, when disparities are more than present, in the area of “soft drugs” at least, who is competent to say that at a certain point, what was lawful has become unlawful ? If one accepts that then does that mean the other Cities in the Netherlands, whose local Authorities did not regulate “the use of cannabis” in the same way as the Municipality of Maastricht, respect the Treaty provisions as regards the free movement of services and the correspondent principle of non-discrimination, but fall outside the law? Then which one? The national one, which does not contain a prohibition as the one laid down by the Maastricht Authorities? The International one, namely the Vienna Conventions from 1961 and 1988? Seems that the answer is in the negative, as the Court pointed out at paragraph 37 that the prohibition at issue complies with the International Instruments that regulate the use and consumption of psychotropic substances, amongst which cannabis. It is only that these International Instruments are not related the EU objective, to establish a Single Market, by guaranteeing the freedom to provide services, without any discrimination. Is there a conflict of laws here? Is it appropriate to accept that the breach of the general principle of non-discrimination, governed by the principle of equal treatment, which is stipulated or inferred in all International instruments, after the Second World War, can be justified by the combating of drug tourism? This is a new term, not existent in the International instruments to which the Court made reference. Moreover, there is no law which states that drug tourism is a criminal offence. The result of this ruling is that drug tourism can be prohibited by making the making discrimination legitimate. Maybe if such, difference is made between lawful and unlawful goods/ services, on a case by case assessment, then the Opinion of AG Bot which states that if one would have agreed with the argument put forward by the plaintiff in the main proccedings, then the exercise of the fundamental freedoms would mean that that trade of narcotic product will be made legal. Moreover, AG Bot considered this equally applicable to human trafficking, prostitution of minors or child pornography.

It remains to be seen in which manner the principle of non discrimination will be applied, for the preservation and development of an area of freedom, security and justice based on the rule of law and respect for fundamental rights.



[1] Case C-137/09, Marc Michel Josemans v Burgemeester van Maastricht, [2010] ECR I-0000, para 46.

[2] C-137/09, Marc Michel Josemans v Burgemeester van Maastricht,, [2010] ECR I-0000, para 80.

[3] Article 56 TFEU.

[4] C-137/09, Marc Michel Josemans v Burgemeester van Maastricht, [2010] ECR I-0000, para 53

Bidar- Case C-209/03

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Preliminary ruling- interpretation of Articles 18 (1), 21 and 165 TFEU and Directive 90/364/EEC in relation to the UK legislation- Education Regulations 2001, Regulation 4 of the Student Support Regulation- Schedule 1.

Assessment of the Court:

The Court dealt with the nationality discrimination prohibition (Article 18 TFEU) related to the citizenship provisions, as enshrined by Article 21 TFEU. In respect to nationality matters, the Court stated that when a situation falls within the scope rationae materiae of EU law, including the exercise of the freedom conferred by Article 21, to move and reside, one can rely on those provisions.

 

The existence of unequal treatment: the Court asserted that there is a difference of treatment of the non-residents students, based on the residence criteria contained in the UK legislation.

 

The justification matter:  a) to ensure that the contribution made by parents or students through taxation is or will be sufficient to justify the provision of subsidised loans;

b) to require a genuine link between the student claiming assistance to cover his maintenance costs and the employment market of the host Member State. The Court found that it is thus legitimate for a Member State to grant such assistance only to students who have demonstrated a certain degree of integration into the society of that State, but that Member State cannot require that the students concerned to establish a link with its employment market- paragraph 58. However, the Court asserted that a certain degree of integration can be reflected by the fact that the respective student has resided in the host Member State for a certain length of time. Still, the rules in question create a treatment that prevents a student who is a national of a Member State and who is lawfully resident and has received a substantial part of his secondary education in the host Member State, and has consequently established a genuine link with the society of the latter State, from being able to pursue his studies under the same conditions as a student who is a national of that State and is in the same situation. As a consequence, the justification was not upheld by the Court, which considered that the prior the residence condition of three years (that the student resided in England and Wales on the first day of the first academic year and that of having resided in the United Kingdom and Islands for the three years preceding that day) is precluded by the application of the first paragraph of Article 18 TFEU (ex Article 12 TEC).

As regards the request to limit the temporal effect of the Judgment, it would have been accepted if two conditions would have been complied with: the legal relations would have been established in good faith and that there would have been a risk of serious difficulties (paragraph 69 and 71), but that was not the case (the Governments of UK, Germany and Austria did not prove that significant financial consequences for the Member States will incur).

Forster- Case C-158/07

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of 18 November 2008, of the Court (Grand Chamber) in Case C-158/07 Jacqueline Förster v Hoofddirectie van de Informatie Beheer Groep, [2008], ECR I-08507-

 

Referred by Centrale Raad van Beroep (Netherlands)

 

 

FACTS:

 

On 5 March 2000, Jacqueline Förster, a German national aged 20, settled in the Netherlands, where she enrolled for training as a primary school teacher and, from 1 September 2001, for a course in educational theory leading to a bachelor’s degree at the Hogeschool van Amsterdam. During her studies, Ms Förster had various kinds of paid employment. The IB-Groep, the competent authority as regards the financing of higher education, granted her a maintenance grant from September 2000. That authority took the view that Ms Förster was to be regarded as a ‘worker’ and, consequently, should be treated in the same way as a student of Netherlands nationality as regards maintenance grants.

 

Following a check, the IB-Groep however ascertained that between July 2003 and December 2003 Ms Förster had not been gainfully employed. Holding that she could therefore no longer be regarded as a worker, the IB-Groep annulled the decision concerning the maintenance grant paid in respect of the period between July and December 2003. Ms Förster was requested to repay the excess sums.

In her appeal against that decision, Ms Förster claimed, inter alia, that she was already sufficiently integrated into Dutch society during the period at issue to be able to claim a maintenance grant as a student under Community law. In this respect, she relies on the judgment of the Court of Justice in Bidar[1],  in which it was held that the existence of a certain degree of integration may be regarded as established by a finding that the student in question has resided in the host Member State for a certain length of time.

 

Following that judgment, the IB-Groep adopted a policy rule which provided that a student from the European Union must have been lawfully resident in the Netherlands for an uninterrupted period of at least five years before claiming a maintenance grant. 

 

The Centrale Raad van Beroep, which had to rule on appeal on the action brought by Ms Förster, made a reference to the Court of Justice.

 

ISSUES/QUESTIONS:

 

Freedom of movement for persons – Student who is a national of one Member State and goes to another Member State to follow a training course – Student maintenance grant – Citizenship of the Union – Article 12 EC – Legal certainty/Under what conditions a student from another Member State may be entitled to a maintenance grant under article 12 TEC, which prohibits any discrimination on grounds of nationality? Is there a compatibility of the application to nationals of other Member States of a prior residence requirement of five years, with the first paragraph of Article 12? In the affirmative, then it is necessary, on a case by case analysis , to take into account other criteria pointing to a substantial degree of integration into the society of the host Member State? Does EU law, especially the principle of legal certainity, precludes the teroactive application of a residence requirement, which at the time of the facts in the main proceedings, could not have been forseen by the applicant?

 

 

ANSWER of the COURT:

 

Community law, in particular the principle of legal certainty, does not preclude the application to students of a requirement of five years’ prior residence.

 

REASONING of the COURT:

 

The Court points out that a student who is lawfully resident in another Member State can rely, for the purposes of obtaining a maintenance grant, on the prohibition of any discrimination on grounds of nationality[2].

 

Since the requirement concerning the duration of residence is not applicable to students of Netherlands nationality, the issue is raised of what restrictions may be imposed on the right of students who are nationals of other Member States to a maintenance grant without the different treatment which may result being considered discriminatory.

 

In this connection, the Court observes that it is legitimate for a Member State to grant assistance covering students’ maintenance costs only to those students who have demonstrated a certain degree of integration into the society of that State and that the existence of a certain degree of integration may be regarded as established by a finding that the student in question has resided in the host Member State for a certain length of time.

 

The Court holds that, in the present case, a condition of five years’ uninterrupted residence is appropriate for the purpose of guaranteeing that the applicant for the maintenance grant at issue is integrated into the society of the host Member State. Furthermore, that condition cannot be held to be excessive.

 

By enabling those concerned to know, without any ambiguity, what their rights and obligations are, the residence requirement laid down by the IB-Groep’s policy rule is, by its very existence, such as to guarantee a significant level of legal certainty and transparency in the context of the award of maintenance grants to students. As regards the retroactivity application of the Dutch rules in relation to the principle of legal certainty, the Court found that the national rules can be applied although the applicant could not foresee them.

 

Comments:

 

It is clear that the Court did not apply the Bidar “formula”. In Bidar the Court found that the residence criteria imposed by the British rules constitutes a discriminatory measure on grounds of nationality, so that a foreign student could not obtain the status of “established person” and as a consequence could not benefit from the study maintenance assistance. In this respect the Court found that three years of residence can prove that the individual is integrated into the host society of the Member State. The applicant in the main proceedings, Ms. Forster, based her action on the Judgment of Bidar, as regards the integration issue, namely the link between the individual and the host society, the so called financialsolidarity.

The discrimination issue was not dealt with as much as it should have been. The Court found that this case differs from Bidar, by the status of “established person”, the requirement of the UK rules for granting studies finances, which was in fact the discrimination criteria, and was applicable regardless of the degree of integration into the host society of the respective Member State[3].

Unlike in the Bidar Case, in this one the Court accepted a national rule stipulating that the only way of proving integration would be five years of prior legal residence, a requirement which most non-national students will not be able meet at all. The individual situation of ms. Forster, the genuine nature of any link with the host society, did not make any difference. Before the time prescribed by the residence requirement elapsed, no integration can be legally obtained, so that no legal effects are attached to the actual integration of non-nationals into the host society of the Member State.

In Bidar, it was exactly the same factual situation of the individual, that triggered the Courts’ finding that there was a genuine link with the British society and that he was integrated at a certain degree.

Moreover, by its reasoning, the proportionality test seems rather shallow and incomplete. There was no inquiry as to whether the means put in place do not go beyond what is necessary or whether a blanket residence requirement is the least harmful measure to reach the objective of integration. The Court merely stated that the residence requirement is indeed proportionate[4]. The arguments referred first, to the provisions of the five years requirement for permanent residence provided by the Dutch rules, which is also contained in Directive 2004/38/EC (which was applicable in Bidar and not here) and second, legal certainty. It is difficult for one to understand the reason why the Court made reference to that Directive, although it was not applicable to the Case. Maybe because it wanted to justity its resoning by suggesting that EU law as regards freedom of movement of persons contains a similar provision with the Duch one, so that makes it compatible not only with the specific EU provisions, but also with the principle of non-discrimination?

Even if Advocate General Mazak, presented “alternatives”, less harmful that would have worked with less rigidity were not explored. In this respect, AG Mazak suggested that the five year requirement can be considered disproportionate as long as one can provide enough evidence to prove that that he or she is already substantially integrated into the society of the host Member State. Moreover, he opined that the answer regarding the compatibility with the principle of non-discrimination, should be that the Dutch rules are to be precluded.

The principle of legal certainty is a fundamental principle of Community law which requires, in areas covered by Community law, that the Member States’ rules should be clear and precise, so that individuals may be able to ascertain unequivocally what their rights and obligations are. It aims to ensure that situations and legal relationships governed by Community law remain foreseeable. The referring court asked whether he principle of legal certainty, precludes the retroactive application of a residence requirement which, at the time of the facts in the main proceedings, could not have been known to the applicant. The answer of the Court, which was in the negative, was based on two arguments, namely, first, that the residence requirement introduced by the Dutch rules, was introduced in order to cover the transitional period between the judgment in Bidar and the transposition of Directive 2004/38. Secondly, the Court noted that the contested Dutch rules give greater rights to the students concerned than those to which they were entitled under the former national rules. Regardless, of the amount of rights provided by the new Dutch rules, one has to ask? Is there not a general principle of law which states that that the law is applicable since its entry into force, unless the new law explains somehow the meaning of the former one? That is the principle of non-retroactivity. Moreover, Advocate General stated in his Opinion that the principle of legal certainty and the protection of the individual do not preclude a rule from being applied retroactively in so far as such application puts the individual concerned in a more favourable legal position. There is derogation from the principle of non-retroactivity, i.e. the criminal law that is more favourable. Is that what the AG made reference to? Even if so, the Court ruled that it is possible.

As a direct result of this ruling, facts pointing towards “actual” integration into the host Members’ State society become legally irrelevant. Altough this will be the case only if the national law contains a formal definition of “integration”, like the Dutch one.



[1] Case C-209/03 Bidar [2005] ECR I-2119,

[2] Case [C-158/07], Jacqueline Förster v Hoofddirectie van de Informatie Beheer Groep, [2008], ECR I- 08507, paragraph 35

[3] Idem, paragraph 47.

[4] Case [C-158/07], Jacqueline Förster v Hoofddirectie van de Informatie Beheer Groep, paragraph 52.

The General Court annuls the fines imposed on Mitsubishi and Toshiba for their participation in the cartel on the gas insulated switchgear market

 

In addition, Fuji’s fine of €2.4 million is reduced to €2.2 million, whereas the fine of €50.4 million imposed on Hitachi is maintained

By decision of 24 January 20071, the Commission imposed fines totalling €750.71 million on 20 European and Japanese companies2 for their participation in a cartel on the market for gas insulated switchgear (GIS). GIS is used as a major component for electric substations to convert electrical current from high to low tension and vice versa. Its function is to protect the transformer from overload and/or insulate the circuit and the faulty transformer.

The companies which participated in the cartel concluded an agreement with a view to coordinating their commercial activity worldwide and developed a quota system aimed at determining the market shares which each group could share among its members.

According to the Commission, the cartel participants also concluded an unwritten understanding to reserve the European market to European undertakings and the Japanese market to Japanese undertakings. In its decision, the Commission found that the cartel had operated from 15 April 1988 to 11 May 2004.

The companies which were fined brought actions before the General Court seeking the annulment of the Commission’s decision and a reduction of their respective fines3. As for the Japanese companies, Mitsubishi Electric (€118.58 million) and Toshiba (€90.9 million) were fined the heaviest.

In today’s judgments the Court finds, first, that it is the alleged commitment of the Japanese undertakings, under the unwritten understanding, not to enter the European market which constitutes an infringement of the European Union competition rules.

In that regard, the Court notes, first, that the existence of an unwritten understanding is proved directly by the statements of several undertakings involved in the cartel and by the witness statements of the employees of one of those undertakings.

Second, the Court confirms the existence of a notification and account loading mechanism attached to the quota system, corroborated by statements made by certain participants to the cartel and by a credible witness. The Court notes that the Japanese undertakings refrained from entering the European market and that the European undertakings committed to notify them of the results of the allocation of GIS projects in certain European countries and to load those projects into the quota system. In doing so, the European undertakings voluntarily committed themselves not to bid for a number of GIS projects on certain international markets, in addition to their commitment not to enter the Japanese market. The European undertakings thus regarded the Japanese undertakings as being potential competitors which could have entered the European market. If they did not do so it is because they committed themselves not to.

The Court thus states that that mechanism constitutes a link between the collusive activities on the European market and the Japanese producers. It therefore constitutes indirect evidence of the unwritten understanding.

Accordingly, the Court upholds the Commission’s decision that the Japanese undertakings participated in the unwritten understanding and, consequently, in the cartel.

Next, the Court examines the method adopted by the Commission to calculate the fines imposed on the Japanese undertakings. In so far as the Commission did not use the same reference year for Mitsubishi Electric and Toshiba (2001) and the European undertakings (2003), the Court finds that the Commission did not treat the Japanese producers and the European producers equally.

The Court notes that the Commission proceeded in that manner in order to take account of the fact that, for most of the period of infringement, Mitsubishi Electric and Toshiba participated in the cartel as individual undertakings, and not as part of their joint venture, TM T&D Corp. Consequently, in calculating their fines, the Commission took account of their turnovers for the year prior to the creation of TM T&D. However, although the objective pursued by the Commission was legitimate, the Court finds that it could have used other methods to achieve its objective without treating the Japanese producers and the European producers unequally.

Accordingly, the Court finds that the Commission infringed the principle of equal treatment and annuls the fines imposed on the two companies concerned.

As regards the Fuji Group, the Court notes that the Commission decided that, for the infringements committed prior to 1 October 2002, a fine of €2.4 million had to be paid joint and severally by Fuji Electric Holdings (‘FEH’), the group’s holding company, and by Fuji Electric Systems (‘FES’), a subsidiary of the holding company4.

In that regard, the Court notes that FEH and FES provided the Commission with essential information relating to the cartel for the period prior to 1 October 2002, which the Commission should have taken into account when calculating the fines in accordance with the Leniency Notice.5

For that reason, the Court imposes a single fine of €2.2 million on Fuji Electric, the company born of the merger between FEH and FES on 1 April 2011.

Finally, the Court rejects the action brought by Hitachi in its entirety.

______________________________________________________________________

1 Commission Decision C (2006) 6762 final relating to a proceeding under Article 81 EC and Article 53 of the EEA Agreement (Case COMP/F/38.899 – Gas insulated switchgear).

2 ABB Ltd, Alstom SA, Areva SA, Areva T&D AG, Areva T & D Holding SA, Areva T & D SA, Fuji Electric Holdings Co., Ltd, Fuji Electric Systems Co., Ltd., Hitachi Ltd,. Hitachi Europe Ltd., Japan AE Power Systems Corporation, Mitsubishi Electric Corporation, Nuova Magrini Galileo S.p.a., Schneider Electric SA, Siemens Electric SA, Siemens AG, Siemens Aktiengesellschaft Österreich, Siemens Transmission & Distribution SA, Siemens Transmission & Distribution Ltd., Toshiba Corporation and VA Tech Transmission & Distribution GmbH & Co KEG.

3 For the cases involving European companies, see the judgments of 3 March 2011 in Case T-110/07 Siemens AG v Commission; Cases T-117/07 and T-121/07 Areva, Areva T & D Holding SA, Areva T & D AG, Alstom v Commission; and Joined Cases T-122/07 to T-124/07 Siemens AG Österreich, VA Tech Transmission & Distribution GmbH & Co. KEG, Siemens Transmission & Distribution Ltd., Siemens Transmission & Distribution SA, Nuova Magrini Galileo SpA v Commission.

4 For the infringements committed after 1 October 2002, the date on which the Fuji Group transferred its GIS activities to the joint venture Japan AE Power Systems ‘JAEPS’, the Commission imposed a fine of €1.35 million on FEH and FES joint and severally with JAEPS and Hitachi, the main shareholder in the joint venture.

5 Commission Notice of 19 February 2002 on immunity from fines and reduction of fines in cartel cases (OJ 2002 C 45, p. 3).

Carlos G. Avello- Case C- 148/02

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of 2 October 2003 [of the Court Grand Chamber] in Case [C-148/02Carlos Garcia Avello v État belge [2003] ECR I -11613

 

Direct action OR Referred by [Conseil d’État (Council of State) (Belgium)]

 

FACTS:

 

Carlos Garcia Avello, a Spanish national, and his Belgian wife, Isabelle Weber, reside in

Belgium and have two children. The children have dual nationality. Belgian law requires

children to take the surname of their father. On their birth certificates, therefore, the children

were registered with the name Garcia Avello. Spanish custom is for children to take the first

surname of each of their parents placing their father’s first and their mother’s second. In line

with this custom the parents requested the Belgian authorities to change the surname of their

children from Garcia Avello to Garcia Weber. They argued that the current name of the

children could lead Spanish people to believe that the children are in fact his siblings and

there is no connection with the mother of the children. Moreover, practical difficulties could

arise from the children effectively having differing surnames in Belgium and in Spain.

 

This application was refused as contrary to Belgian practice. Mr Garcia Avello challenged

that refusal before the Belgian Conseil d’Etat.

 

ISSUES/QUESTIONS:

 

Citizenship of the European Union – Handing down of surnames – Children of nationals of Member States – Dual nationality/ Is the refusal contrary to Community law, in particular the principles relating to citizenship of the European Union and the freedom of

movement for citizens?

 

ANSWER of the COURT:

 

Articles 12 EC and 17 EC must be construed as precluding, in circumstances such as those of the case in the main proceedings, the administrative authority of a Member State from refusing to grant an application for a change of surname made on behalf of minor children resident in that State and having dual nationality of that State and of another Member State, in the case where the purpose of that application is to enable those children to bear the surname to which they are entitled according to the law and tradition of the second Member State.

 

REASONING of the Court

 

First the Court assessed whether the situation falls within the scope of EU law. In this regard the Court followed advocate General Jacobs Opinion and answered in the affirmative.

 

Whilst it is true that Community law on citizenship and freedom of movement does not

apply to cases between a State and its own nationals, this Case concerns not only the children, who are Belgian nationals, but also Mr Garcia Avello, a Spanish national who has exercised his Community right to move to and work in another Member State. The refusal concerns Mr Garcia Avello, as the person who instituted legal proceedings, and the issue, being the transmission of surnames from one generation to the next, is of importance to both generations. Moreover the because the children are Belgian nationals, they also have Spanish nationality, a fact which is

inseparable from their father’s exercise of his right to free movement.

 

As a result of the introduction of the introduction of Community citizenship, discrimination on grounds of nationality is clearly prohibited in all situations where Community law is applicable and that there is no need to establish a specific interference with a specific economic freedom. It follows then to assess whether the refusal by the Belgian authorities discriminates on grounds of nationality and whether this discrimination can be justified[1].

 

The Court states that the refusal amounts to discrimination on grounds of nationality, prohibited by EU law law, as it treats objectively different situations in the same way. As a change of surname is allowed under Belgian law when serious grounds are given for the application, a systematic refusal to grant a change when the grounds given are linked to or inseparable from the possession of another nationality, must be regarded as discriminating on grounds of nationality. This practice accords the same treatment both to those who, as a result of possessing a nationality other than Belgian, bear a surname or who have a parent whose surname was not formed in accordance with Belgian rules and to those who possess only Belgian nationality and bear a surname formed according to those rules, despite the fact that their situations are objectively different.

 

The Court answered that this discrimination cannot be justified as there is no overriding public interest that one particular pattern of surname transmission should always prevail for the citizens of a Member State within its territory. Moreover, the aim of preventing confusion over identity by limiting the right to change surnames is a legitimate one, the dangers should not be exaggerated and that official registration of a change of name will reduce the chance of confusion. In the light of the foregoing it cannot be argued that the principle of nondiscrimination seeks to ensure the integration of migrant citizens in their host State[2].

 

Comments:

 

After the EU citizenship was introduced into the EU legal order, the Luxembourg Court extended the scope ratione matariae of Article 12 TEC, now Article 18 TFEU considerably. In this respect, aspects of a Union citizen personal status are covered by the fundamental freedoms.

Starting from the proposition that Article 18 TFEU does not only prohibit Member States to treat comparable situations differently, but also to treat different situations in the same way (para 31),[3] the Court held that Mr Garcia Avello’s children indeed suffered discrimination because the Belgian authorities treated them in the same way as persons who have only Belgian nationality though their situation was different: As opposed to persons having merely Belgian nationality, Belgian nationals having Spanish nationality as well “have different surnames under the two legal systems concerned” (para 35). Referring to the Opinion of the Advocate General, the Court stressed that such a discrepancy “is liable to cause serious inconvenience for those concerned at both professional and private levels resulting from, inter alia, difficulties in benefiting, in one Member State of which they are nationals, from the legal effects of diplomas or documents drawn up in the surname recognized in another Member State of which they are also nationals” (para 36). The principle of non-discrimination is not directed against any criterion of comparison (tertium comparationis[4]) in particular, but against arbitrariness in using such a criterion whatever it may be. In this context, the second part of the Aristotelian formula of equality[5] that is directed against any arbitrary equal treatment of different groups is a complement to the first part of the formula that aims at any arbitrary unequal treatment. Article 18 TFEU, by contrast, singles out nationality as a specific criterion of comparison that must not be used by a Member State unless its use can be justified. If the second part of the Aristotelian formula is applied to such a prohibition it is not a complement to the first part of the formula but counteracts its effect by putting a burden on a Member State to justify its abstention from using nationality as a criterion. By blurring the distinction between Article 12 EC and the general principle of non-discrimination, the Court has evaded the question whether there is a good reason to read the second part of the Aristotelian formula into Article 18 TFEU (or, it may be added into any other specific prohibition of discrimination, thus fostering unequal treatment on grounds of nationality, gender, race etc.).

In the aftermath of this ruling, Belgium preferred not to change its private international law but merely decided to take heed of the judgment in its administrative practice when confronted with applications for a change of surname by Belgians who are also nationals of another Member State. This is a viable solution if the need to adapt the domestic system to the demands of recognition remains an exception. But achieving recognition will not always be such an easy task. If the duty to adapt to another Member State’s legal position on matters of personal status becomes a common occurrence (which will be the case if the Court follows Advocate General Jacobs’ path), major changes either on the level of substantive law or on the level of private international law of some Member States may be inevitable. The Member States concerned may find themselves between Scylla and Charybdis: liberalising the substantive rules on personal status in order to accommodate all needs of Union citizens circulating between Member States may require watering down their contents to a degree that their material objects become unrecognisable.



[1] Case [C-148/02]  Carlos Garcia Avello v État belge [2003] ECR I -11613 paragraph 39.

[2] Idem, Paragraph 43.

[3] In order to support this statement, the Court cited Case C-354/95, National Farmers’ Union and Others, [1997] ECR 1-4559 para 61

[4] Latin = the third [part] of the comparison is the quality that two things which are being compared have in common.

[5] Aristotle, Politics: “Justice is equality, but only for equals; and justice is inequality, but only for those who are unequal”

Bressol- Case C-73/08

August 4th, 2011 | Posted by DUCA LL.M in EU Law - (0 Comments)

Ruling of [of the Grand Chamber] in Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernment de la Communauté française [2010], ECR I-0000

 

Referred by [Cour constitutionnelle -Belgium]

 

FACTS:

 

The Belgian rules imposed a residence condition for non- resident students in order for them to enroll for the first time with higher education in Belgium – a student had to prove that his principal residence is in Belgium and that he or she complied with one more requirement from a list of eight conditions linked to the residence criteria or the right to remain on the Belgian territory.

The French Community of Belgium took this measure given the increasing number of students from other Member States, in particular France, that enroll in its institutions of higher education, in particular in nine medical or paramedical courses[1]. The applicants in the main proceedings, which were students and university lecturers, sought its annulment, on grounds of nationality discrimination. They submitted that while resident students enjoy free access to the courses referred to in the Decree, access by non-resident students to those courses is restricted in such a way that the number of students enrolled in those courses may not exceed the 30% threshold.

 

ISSUES/QUESTIONS:

 

Interpretation of EU law provisions in the field of free movement of students (Articles 165 and 150 TFEU, governed by the principle of non-discrimination on grounds of nationality (Article 18 TFEU and by the rights arising from the EU citizenship (Article 21 TFEU)in relation to the Belgian rules/The referring court asked whether the Belgian rules , are compatible with the provisions enshrined in the Treaty.

 

ANSWER of the COURT:

 

The answer provided by the European Court of Justice was in the negative. The Court stated that the Treaty provisions, namely Articles 18 and 21 TFEU , which provide that any discrimination on grounds of nationality shall be prohibited and respectively that every European Union citizen shall have the right to move and reside freely within the territory of the Member States, under the derogations laid down in the Treaties or in secondary legislation, preclude the contested national legislation, unless the referring court, will find, after assessing all the relevant evidence presented by the competent authorities, that that legislation is justified by the overriding reason, respectively, the protection of public health objective.

 

REASONING of the Court

 

First, the European Court of Justice finds that the legislation in question creates a difference in treatment between resident and non-resident students. Such a difference in treatment constitutes indirect discrimination on the ground of nationality which is prohibited, unless it is objectively justified

The Court assessed also the Member States competence in education matters and asserted that Member States have a wide discretion in the field, under the limits imposed by EU law, in particular as regards the provisions on the freedom to reside within the territory of the Member States. That means that national rules must comply with EU law, in particular with the principle of non-discrimination on grounds of nationality.

As regards the applicable rules to the case in the main proceedings, these were the Treaty provisions of prohibition on grounds of nationality and of citizenship; Articles 18 (1) TFEU and 21 TFEU. In respect to the nationality matter, the Court stated that when a situation falls within the scope rationae materiae of EU law, including the exercise of the freedom conferred by Article 21, to move and reside, one can rely on those provisions[2]. As the applicants are citizens of the European Union, Directive 2004/38[3] was also applicable, as it concerns all citizens regardless of their economic activity[4]. This Directive provides that EU citizens who do not have Belgian nationality may claim the right to ‘reside permanently in Belgium’ only within the limits laid down, namely after a continuous period of lawful residence in Belgium of five years. In the opposite case and if they cannot satisfy any of the seven other criteria, they will be classified as non-resident.

After the Court found the existence of unequal treatment, of the non-residents students, based on the residence criteria contained in the Decree, the Court went on and dealt with the justification matter.

Three different justifications ware invoked by the Belgian Government, along with the Austrian Government, namely           excessive burdens on the financing of higher education, protection of the homogeneity of the higher education system, public health requirements. The first one was not upheld by the Court, reasoning that the financing of education in the French Community was organised through a ‘closed envelope’ system in which the overall allocation did not vary depending on the total number of students[5]. The closed envelope system summarises economics and thermodynamics concepts, where the envelope method represents a popular method for visualizing and maintaining a budget and the closed system from thermodynamics, is a system that has no connection with the outside and  no mass may be transferred in or out of the system boundaries.  Used in the present Case, it is a metaphor for the Belgian Education Budget, regulated also by the contested Decree, that implies that a decrease in the number of students regardless of their nationality, does not entail any corresponding saving of money for the French Community. An increase or decrease in student numbers is budget-neutral.

On the other hand, the second objective invoked, was examined in the light of the third one, and the Court found that safeguarding the public health, for the purpose of protecting the homogeneity of the higher education system, could constitute a legitimate objective, capable of justifying a indirectly discriminatory  measure.

The proportionality assessment lead to the assertion that the national court has sole jurisdiction to determine whether the measure at issue is appropriate and does not go beyond what is necessary in order to attain the legitimate aim pursued.

First, it is for the national court to assess if there are genuine risks for the protection of the public health. That is why, it cannot be ruled out before that a reduction in the quality of training of future health professionals may ultimately impair the quality of care provided in the territory concerned. Moreover, it would be difficult to assert that a limitation of the total number of students in the courses concerned may reduce, proportionately, the number of graduates prepared in the future to ensure the availability of the service in the territory concerned, which could then have an effect on the level of public health protection.

Secondly, if the national court considers that there are true risks to the protection of public health that court must assess, in the light of the evidence provided by the national authorities, whether the legislation at issue in the main proceedings can be regarded as appropriate for attaining the objective of protecting public health. That means that the referring court must determine whether a limitation of the number of non-resident students can really bring about an increase in the number of graduates ready to ensure the future availability of public health services within the French Community[6].

Thirdly, it also for the national Court to assess whether the contested restriction is necessary or the legitimate aim pursued can be attained by less restrictive measures.

Moreover, the referring court must examine whether the competent authorities have reconciled, in an appropriate way, the attainment of that objective with the requirements of European Union law and, in particular, with the opportunity for students coming from other Member States to gain access to higher education, an opportunity which constitutes the very essence of the principle of freedom of movement for students[7]. The restrictions on access to such education, introduced by a Member State, must therefore be limited to what is necessary in order to obtain the objectives pursued and must allow sufficiently wide access by those students to higher education.

In that regard, it is for the national court to decide whether the selection process for non-resident students is limited to the drawing of lots and, if that is the case, whether that means of selection based not on the aptitude of the candidates concerned, but on chance, is necessary to attain the objectives pursued.

A last issue that arose before the Court in this case was the one request submitted by the Belgian Government, that if the Court would consider the national legislation at matter incompatible with EU law, then the temporal effect of the judgment delivered to be limited. Reasons behind this request ware linked to the possible serious economic repercussions tending to destabilise the French Community’s education budget. Other grounds indicated in support of its request were related to the fact that the Decree was conceived specifically to comply with the Court’s case-law and with Community legislation; the fact that the Commission has indicated that the system may be justifiable; and the lack of relevant case-law. The European Court of Justice considered that the Belgian Government did not bring enough evidence  to demonstrate the economic danger that might occur in case the judgment will not be temporally limited, and consequently, that request was dismissed. This remark was also contained in the Advocates’ General Opinion, which stated at point 149, that the Belgiums’ Government has not placed material before the Court, meant to demonstrate the serious economic repercussions.

Comments:

 

The matter of discrimination was dealt with extensively, whether the Belgian legislation constitutes direct or indirect discrimination. In this respect, AG Sharpston made reference to the 2007 Commissions’ letter of formal notice, which stated that it was direct discrimination. It must be noted that the Commissions’ position in the Case was on the opposite. On January 24, 2007, the EU Commission sent a letter of formal notice to Belgium, expressing concerns about the compatibility of the Decree with EU law. On May 24, 2007, Belgium replied to that letter, providing certain statistics and explanations. On November 28, 2007, considering that, without appropriate protective measures, the French Community of Belgium ran the risk of not being ‘able to maintain sufficient levels of territorial cover and quality in its public health system’, the Commission decided to suspend the procedure for five years ‘in order to allow the Belgian authorities to provide additional information in support of the argument that the restrictive measures imposed are both necessary and proportionate’[8]

In respect to the character of discrimination on grounds of nationality, whether direct or indirect, one can observe that there is no clear definition of the term “direct discrimination” in the EU case law and as a consequence, it must be deduced from the Court’s rulings on the basis of the principle of equal treatment and of indirect discrimination. Advocate General Sharpston emphasized that in order to avoid the 30% quota for non-resident students, one had to meet two cumulative conditions: principal residence in Belgium at the time of the registration with the higher institution of education and fulfillment of one of eight further conditions, listed in the Decree. It is worthnothy the second cumulative condition that provided the right to remain permanently in Belgium, which is automatically enjoyed by Belgian nationals[9]. This difference in treatment was based clearly on the nationality criterion (the right to remain permanently in Belgium) so that it was argued by the  Advocate General that this leads to direct discrimination on grounds of nationality. Further she noted that according to the Courts’ case-law, direct discrimination on grounds of nationality was never found to be justified, even if there were Cases that hinted at that theoretical possibility[10].

The Belgian Government was entirely reversed in its allegations by Advocate General Sharpston, who did not accept the legitimate aim of excessive burden on the public finance, sharing the reservations expressed by AG Jacobs in Case C‑147/03 Commission v Austria [2005] ECR I‑5969, as regards applying statements made by the Court in the context of burdens on national social security systems to the domain of higher education[11]. It was stated that a difference must be made between the national security systems and higher education, based on the fact that the latter does not fall within the meaning of Article 56 TFEU, providing free movement of services. In respect to second objective invoked, Advocate General Sharpston went on arguing that it is fairly unlikely to accept even the theoretical possibility that indirect discrimination measures to counter a real, serious and imminent threat to the quality of university education could in principle be capable of objective justification[12]. Moreover, it has not been proven that that less resident students would obtain diplomas for there to be, over a long period, a sufficient number of qualified medical staff to ensure the quality of the public health system[13].

Surprisingly or not, harmonization in the movement of students between Member States was presented as a solution, as she invited the EU legislator and the Member States to reflect upon the application of the principle of subsidiarity and proportionality, as enshrined by Protocol 30, part of the TFEU.

Finally, she added that Article 10 TEC, now Article 4 TEU, should provide relevant guidance, meaning that it “…is surely incumbent on both the host Member State and the home Member State actively to seek a negotiated solution that complies with the Treaty”[14].

The Advocates’ General Opinion contains a final remark that states “…however, the EU must not ignore the very real problems that may arise for Member States that host many students from other Member States”. Does this mean that the discrimination criteria should be accepted as legal in order to “prevent” the free movement and residence within EU, as enshrined by the Treaty?


[1] The courses concerned lead to the following degrees: Bachelor in physiotherapy and rehabilitation, Bachelor in veterinary medicine, Bachelor of midwifery, Bachelor of occupational therapy, Bachelor of speech therapy, Bachelor of podiatry-chiropody, Bachelor of physiotherapy, Bachelor of audiology and Educator specialised in psycho-educational counselling.

[2] Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, para 31.               

[3] DIRECTIVE 2004/38/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 29 April 2004 on the right of citizens of the Union and their family members

to move and reside freely within the territory of the Member States amending Regulation (EEC) No 1612/68 and repealing Directives 64/221/EEC, 68/360/EEC, 72/194/EEC, 73/148/EEC, 75/34/EEC, 75/35/EEC, 90/364/EEC, 90/365/EEC and 93/96/EEC

[4] Directive 2004/38 is EEA relevant and was transposed in Icelandic law (Act on Foreigners No 96/2002, Act on Passports No 136/1998, Act on Administrative Procedures No 37/1993, Act on Legal Residence 21/1990, Act on the Right to Free Movement and Residence within EEA No 47/993, Regulation No 53/2003 on Foreigners and Regulation No 1212/2007 on Travel Across Borders). The Directive was implemented in EEA with few exceptions, via the Joint Committee Decision 158/2007- EU citizenship is not included in the Agreement, immigration policy is not part of the EEA agreement and EEA Agreement does not apply to third country nationals. Derogations are related to the fisheries and fish processing.

[5] Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, para 50.

[6] Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, para 67-71.

[7] Idem, para 79.

[8] At the same date, the Commission sent a letter of formal notice to Austria for non-compliance with the Court’s Judgment in Case C‑147/03 Commission v Austria [2005] ECR I‑5969. The same, the procedure was suspended.

[9] Opinion of Advocate General in Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, point 65: “All Belgian nationals automatically enjoy the right to remain permanently in Belgium (the first of the eight possible criteria within the second cumulative condition of Article 1 of the Decree). No non-Belgians automatically have such a right. Therefore, they must either meet certain additional conditions to acquire such a right (namely those prescribed by Directive 2004/38) or fulfil one of the other criteria listed in that provision”.

[10] Case C‑360/00 Ricordi [2002] ECR I‑5089 paragraph 31, Case C‑323/95 Hayes [1997] ECR I‑1711, paragraph 24, Case C‑122/96 Saldanha and MTS [1997] ECR I‑5325, paragraph 26 et seq.

[11] Unequivocally, the Court ruled that a Member State must take all necessary measures in order to comply with the EU provisions of free movement of students, which is a fundamental right guaranteed by the Treaty. In case there are national rules that lead to unequal treatment, then those rules must be justified. The burden of proof,that is incumbent for the Member State, implies  an analysis of the appropriateness and proportionality of the restrictive measure adopted by that State and specific evidence substantiating its arguments. As the Austrain Government provided no such figures or evidence to sustain its allegations, the Court asserted that the Republic of Austria failed to fulfil its obligations under the Treaty provisions, related to nationality discrimination prohibition and free movement of students.

[12] Opinion of Advocate General in Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, point 112.

[13] Opinion of Advocate General in Case C-73/08, Nicolas Bressol and Others and Céline Chaverot and Others v Gouvernement de la Communauté française,  [2010], ECR I-0000, point 126.

[14] Idem, paragraph 154.

An action against Norway was brought before the EFTA Court on 21 July 2011 by the EFTA Surveillance Authority, represented by Xavier Lewis, Florence Simonetti Gjermund Mathisen, acting as Agents of the EFTA Surveillance Authority, 35, Rue Belliard, B-1040 Brussels.The EFTA

Surveillance Authority requests the EFTA Court to declare that:

1. By maintaining in force such restrictions on the rights of persons and undertakings established in EEA States to own holdings and exercise voting rights in regulated markets in Norway as provided for in Sections 35(1), (2) and (3) and 36 of the Act of 29 June 2007 No 74 on Regulated Markets (the Stock Exchange Act) and Sections 5-3(1), (2) and (3) and 5-4 of the Act of 5 July 2002 on Registration of Financial Instruments (the Securities Depositories Act), the Kingdom of Norway has failed to fulfil its obligations arising from Articles 31 and 40 EEA.

2. The Kingdom of Norway bear the costs of the proceedings.

Legal and factual background and pleas in law adduced in support:

– Norwegian legislation restricts ownership of and voting rights in financial services infrastructure institutions. As a main rule the Stock Exchange Act prohibits the holding of more than 20% of the shares in stock exchanges, as well as the voting for more than 20% of the total voting capital or 30% of the votes represented at the general meeting. Corresponding rules with respect to securities depositories are laid down in the Securities Depositories Act.

– The EFTA Surveillance Authority submits that the contested legislation is incompatible both with the freedom of establishment under Article 31 EEA and with the freedom movement of capital under Article 40 EEA.

– The EFTA Surveillance Authority submits in particular that the contested legislation is unnecessary to promote the well-functioning and efficiency of the financial markets and to inspire confidence among market operators in the independence and impartiality of the
institutions. It argues that alternative, less restrictive measures are available that would be sufficiently effective.