FREE MOVEMENT OF GOODS (PROBLEM SOLVING)

The free movement of goods between the Member States (MSs) is one of the four fundamental
freedoms established by the Treaty of Rome. Art. 26 TFEU stated that the idea is not simply that
goods should be able to cross the borders between MSs without having to pay duties or face any
other kind of obstacle, but those very borders should cease to exist as far as movement of goods is
concerned.

When considering the free movement of goods it is important to distinguish between monetary
barriers that fall under Art. 28-30 TFEU or may be discriminatory taxation under Art. 110 TFEU,
and all other barriers to trade which do not involve payment of charges and which may be
considered under Art. 34-36 TFEU.

This problem question is concerned with Art. 34 TFEU. Art. 34 provide a general prohibition on
quantitative restriction (QR) and measures having equivalent effect to quantitative restriction
(MEQR), on imports. (Discuss facts). In Geddo the Court held that a prohibition on QR covers
measures which amount to a total or partial restraint of imports, exports or goods in transit.
(Discuss facts). However, in my opinion the measure taken is unlikely to fall within QR. So, we
need to consider whether it falls within MEQR. In Dassonville MEQR has been said to include all
trading rules enacted by the MSs which are capable of hindering, directly or indirectly, actually or
potentially, intra-Community trade. In this particular fact, …........... would certainly fall within
MEQR as it hinders trade. According to Cassis de Dijon where a good is lawfully produced and
marketed in one MS it is presumed that it should be lawful in every other MS. Since, the goods
were lawfully sold in …........ so it should be lawful in ….......... Hence, the measure adopted by …........
is a violation of Art. 34 TFEU. So, there has been a prima facie infringement of Art. 34 by ……..

Provided there is no EU fully harmonized measure, Art. 36 allows exceptions on …............ grounds
and this what the MS pleads. Furthermore, it must be satisfied that the measure is proportionate
(i.e. necessary to achieve the desired result) (Campus Oil) and they must not constitute a means of
arbitrary discrimination or disguised restrictions on trade between the MSs. (Discuss facts)

In this particular instance, the measure taken by the MS applies to both imported and domestic
products and is thus equally applicable, which is termed indistinctly applicable. The Court in the
case of Cassis de Dijon also held that MSs can still have their own rules for domestic producers,
but they can require imported goods to comply with their national rules only if the following
conditions are fulfilled: a) the rule in question applies equally to domestic products; b) the rule is
necessary to protect an essential public interest (i.e. mandatory requirement); and c) it is
proportionate. (Discuss facts)

In light of the above discussion, it can be concluded that the measure adopted by the MS would
infringe Art. 34 TFEU. So, the claimant would be advised to encourage the Commission to take
action against the MS. In Van Gend en Loos it has been established that treaty articles have vertical
direct effect. So, the claimant may bring an action against the offending MS for violation of Art. 34
TFEU. It may also be possible for the claimant who has suffered damage to take the government
before the national courts for damages under the Francovich state liability principle.

Selling Arrangement

In this particular instance, the measure regarding …........... falls within selling arrangement
because it does not effect the content of the product rather it regulates the method of sale. In Keck
the Court held that certain equally applicable provisions restricting selling arrangements are not
to be considered a hindrance on trade according to the Dassonville case and thus falls outside the
scope of Art. 34, provided that they affect all traders and all domestic products and imports in the
national territory, in the same manner, i.e. equal effect in law and in fact. (Discuss facts)

In De Agostini the ECJ indicated that advertising bans which prevent access to the market by
products from another Member State or impede access more than they impede the access of
domestic goods despite being selling arrangements, will nonetheless be caught under Article 34
TFEU. Similarly, in Gourmet the Court concluded that a prohibition on all forms of advertising was
liable to impede access to the market for products from other Member States more than for
domestic products with which consumers are already familiar. (Discuss facts). Therefore despite
being selling arrangement the measure is likely to be caught by Article 34 TFEU.
The Court of justice has thus refined the Keck test so that it is no longer a question simply of
asking where a change to the product itself is required, but whether 'access to the market' is
made more difficult for imported products compared to similar domestic products (Commission
vs Italy; Mickelson). (Discuss facts)

Custom Duties

It must now be considered whether the fee imposed is an unlawful charge under Art. 30 TFEU.
According to Art. 30, MSs are prohibited from introducing any new custom duties on imports and
exports or any charges having equivalent effect. Charges having equal effect have been held to
include any pecuniary charge, however slight, imposed on goods by reason of the fact that they
cross-frontiers (Sociaal Fonds). (Discuss facts).

On the other hand, the MS might argue that in this particular fact the charges are acceptable
because they have provided a service to the claimant. However, unless a service is mandatorily
required under Community law, it appears that only a service which gives a tangible benefit to the
importer, or the imported goods, will be regarded as sufficient to justify a charge (Re Statistical
Levy), and even then it will not be permissible if the service is one imposed on the importer in the
general interest (Rewe-Zentralfinanz). Where a service is provided for the benefit of the importer
the Court has held that the charge must not exceed the value of the cost of the service (Rewe-
Zentralfinanz), or a sum proportionate to the service rendered (Commission Vs Denmark). A
charge based on the value of the goods is not permissible (Ford Espana SA). (Discuss facts).

Public Health

[Where MS pleads the defense of public health, you will have to write paragraph A]

A) For successfully pleading this defense, MS will have to prove that the risk to health is genuine,
and not a disguised restriction on trade (Re Imports of Poultry Meat). The court will take into
account the attitude of other MSs and of international health bodies when assessing whether
particular ingredients pose a real risk to health (Additives in Beer). (Discuss facts). Where the
available scientific evidence on the health impact of particular substances is unclear, then MS can
decide what level of protection is appropriate, subject to the proportionality rule (Sandoz).

[If the MS imposes some sort of test on the imported goods, then you have to write
paragraph A and B]

B) Any inspection is, in principle, a MEQR because, even if there is no charge for it, it causes delay
and is a hindrance to importation. The importing state must take into account evidence of any
tests already complied with in the exporting state, and only if it can show those are insufficient
can it require additional tests (UHT Milk).