EU Law: Free Movement of Goods PDF

Week 6 -- Free Movement of Goods What is a good? Commission v Italy (Art Treasures) - In Art Treasures, the Court defined goods as 'products which can be valued in money and which are capable, as such, of forming the subject of commercial transactions.' (p. 428) This includes 'artic...

Week 6 -- Free Movement of Goods What is a good? Commission v Italy (Art Treasures) - In Art Treasures, the Court defined goods as 'products which can be valued in money and which are capable, as such, of forming the subject of commercial transactions.' (p. 428) This includes 'articles of artistic or historic interest', even though to many a piece of art like Michelangelo's David is priceless. **Internal Market** (area without internal frontiers in which free movement of goods, persons and services is ensured) - elimination of all obstacles to intra-\[Union\] trade in order to merge the national markets into a single market bringing about conditions as close as possible to those of a genuine internal market negative/ positive integration (= free internal market of all barriers/ adopt positive legislation to remove obstacles to intra-Union trade, harmonization of national laws) **Harmonization** (=diverse national laws are brought closer together by means of a European Union act) Art 114 -- general competence to ensure establishment and functioning of the internal market - Competence may be exercised to prevent the emergence of future obstacles to trade resulting from multifarious development of national laws', however the emergence of such obstacles must be likely and the measure in question must be designed to prevent them **Free Movement of Goods** [Tariff Barriers: Custom duties] - Custom duties are used by protectionist states as a economic weapon to limit cheaper imports and thus protect national products Art 30 TFEU -- prohibition of custom duties on imports and exports and charges having equivalent effect between MS - Regardless of the purpose of the customs duty or charge having equivalent effect - **Custom duty** (any pecuniary charge, however small and whatever its designation and mode of application, which is imposed on goods by reason of the fact that they cross a frontier) **Charges having equivalent effect** (any charge which, by altering the price of an article exported, has the same restrictive effect on the free circulation of that article as a customs duty) - Only covers to measures that apply at the **external border** - **Implied Justifications** Charges that a MS levies as compensation for frontier checks that are requires under EU law In situations where a customs charge is seen as consideration for a service offered by the State [Regulatory Barriers: Quantitative Restrictions] (= non-tariff barriers to trade which cannot be overcome by the payment of money) Art 34 (Restrictions on Import) Quantitative restrictions on imports and all measures having equivalent effect shall be prohibited between MS **Quantitative restrictions** (= restrictions that limit the quantity of imported goods to a fixed amount) **MEEQRs** Measures having an equivalent effect to Quantitative Restrictions Article 34 ---------------------- -- ---------------------- ----------------------- ----------------------- **Boarder-Measures** **Internal Measures** (between MS) Product Requirements Selling Arrangements Consumer Restrictions *Dassonville* *Cassis de Dijon* *Keck* *Italian Trailers* *Case* *Dassonville*: all trading rules enacted by Member States which are capable of hindering, directly or indirectly, actually or potentially, intra-Union trade are to be considered as measures having an effect equivalent to quantitative restrictions (Certificate for Whiskey in Belgium) *Case Cassis de Dijon* product requirements; unless specifically justified by mandatory requirements in the general interest, Member States are not entitled to impose their domestic product standards on imported goods, provided the products have been lawfully produced and marketed in one of the MS (principle of mutual recognition) (Minimum alcohol in Germany) *Keck:--* requirements on how a product is marketed, are allowed as long as they do not hinder trade -product requirements hinder trade only in case they affect in the same manner ther marketing of domestic products and those from other MS, *Case Tobacco Advertising* -- The ruling clarified the limits of EU legislative powers, particularly when measures aim at public health rather than internal market objectives. Art 35 (Restrictions on Export) Quantitative restrictions on exports, and all measures having equivalent effect, shall be prohibited between Member States. **Justifying Regulatory Barriers** Art 36 - Art 34/35 do not preclude prohibitions or restrictions on imports, exports or goods in transit justifies on grounds of [public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property]. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States **+ Implied Justifications** Cassis de Dijon: obstacles to the free movement of goods are exempted if 'necessary in order to satisfy mandatory requirements relating in particular to the effectiveness of fiscal supervision, the protection of public health, the fairness of commercial transactions and the defence of the consumer **The Proportionality Principle and National Standards** Express or implied justification - even if a legitimate public interest can be found to potentially justify a national measure, restrictions on the free movement of goods will be subject to a proportionality test **Proportionality** (= national legislation which restricts or is liable to restrict intra-\[Union\] trade must be proportionate to the objectives pursued and that those objectives must not be attainable by measures which are less restrictive of such trade) Week 7 Free Movement of Persons **Free Movement of Workers** Art 45 TFEU (direct effect) - Citizenship Directive [Personal Scope ] - Workers: for a certain [period of time] a person performs services for and [under the direction of another person] in return for which he receives [remuneration (]*Lawrie Blum Case)* (minimalist standard: the number of working hours and the level of remuneration is irrelevant, except where the activity is so small that it is 'purely marginal and ancillary) - Quasi-Workers: Non-employed persons may thus continue to enjoy worker rights; yet these rights require 'some continuity' with the previous occupational activity, persons seeking employment if that person has genuine chance of being engaged [Material Scope ] Privisoons outlined in Art 45 on non-discrimination are outlined in the Citizenship Directive and the Workers Regulation Art 4 Workers Regulation - Provisions laid down by law, regulation or administrative action of the Member States which restrict by number or percentage the employment of foreign nationals in any undertaking, branch of activity or region, or at a national level, shall not apply to nationals of the other Member States Art 7 (1) Worker Regulation contains prohibition of indirect and direct discrimination - Direct discrimination - Indirect discrimination: national laws that 'although applicable irrespective of nationality' nonetheless 'affect essentially migrant workers or the great majority of those affected are migrant workers' or when national laws 'are indistinctly applicable but can more easily be satisfied by national workers than by migrant workers or where there is a risk that they may operate to the particular detriment of migrant workers' Non-discriminatory restrictions: 'national provisions which preclude or deter a national of a Member State from leaving his country of origin in order to exercise his right to freedom of movement constitute restrictions on that freedom even if they apply without regard to the nationality of the workers concerned' - covered by Article 45 TFEU [Justifications ] Article 45(4) TFEU states that 'the provisions of this Article shall not apply to employment in the public service'. Art 7(2) **Member States are entitled to justify differential treatmen**t 'if it is based on objective considerations that are independent of the nationality of the persons concerned and proportionate to the legitimate aim of the national provisions - *Lawrie Blum Case*: - posts which involve direct or indirect participation in the exercise of powers conferred by public law and thus [require a special relationship of allegiance to the State] **Lawrie Blum:** [Workers definition: ] - Person has to be settled - Under the direction of someone else - Antonissen: "future" employment also possible. Seekers: 6 months & after evidence needed. - Lair: Non-employed persons may continue to enjoy workers rights -\> some continuity. ECJ decided that there was no minimum period a worker must work before being able to exercise rights as a migrant worker. - Payment of remuneration - Levin: Also part-time possible, person remunerated for "effective & genuine activity", number of h & pay irrelevant; except where activity is so small that it is "purely marginal & ancillary". - Subsequent jurisprudence consolidated this. As long as worker is capable of being regarded as forming part of normal labour market, benefits ok. - Even worker if financial assistance from state is needed. - Pensioners who worked in country can stay **Freedom of Establishment/Services** Art 49 TFEU [Personal Scope:] Self Employed Persons and companies **Establishment** (= allowing the community national to participate on a stable and continuous basis in the economic life of a MS other than his state of origin **Providing of Services** (=activity is pursued on a temporary basis) - If an activity is pursued on a temporary basis must be examined in light of duration, regularity, periodicity or continuity of the service. [Material Scope ] - Primary establishment occurs where a natural or legal person establishes itself for the first time - Secondary establishment 'the setting-up of agencies, branches or subsidiaries by nationals of any Member State \[already\] established in the territory of any Member State *Gebhard Case*: 'national measures liable to hinder or make less attractive the exercise of fundamental freedoms guaranteed by the Treaty must fulfil four conditions: they [must be applied in a nondiscriminatory manner]; they must be [justified by imperative requirements in the general interest]; [they must be suitable for securing the attainment] of the objective which they pursue; and they [must not go beyond what is necessary in order to attain it]. - Could national rules restrict exercise of establishment? Have to meet criteria. [Justifications ] Art 52 excluding activities 'connected, even occasionally, with the exercise of official authority **Freedom** **European Citizenship** (= rights that pertain to all European Citizens by virtue of being Union Citizens) Art 20 TFEU *Case Ruiz Zambrano*: Article 20 TFEU precludes national measures which have the effect of depriving citizens of the Union of the genuine enjoyment of the substance of the rights conferred by virtue of their status as citizens of the Union (2 Belgian children, Parents not EU nationals) Art 21 TFEU [grants movement rights to all EU Citizens] (national measures shall not discourage or render impossible the right to exercise free movement) [in connection with Art 18 TFEU] -- any discrimination (direct or indirect) on grounds of nationality in host state is prohibited =\> right to equal treatment - **Citizenship Directive (Secondary Legislation)** - Art 24 (2) Equal Treatment -- host MS is not required to confer entitlement to social assistance during the first three months of residence or where appropriate - *Case Dano:* So far as concerns access to social benefits, such as those at issue in the main proceedings, a Union citizen can claim equal treatment with nationals of the host Member State only if his residence in the territory of the host Member State complies with the conditions of Directive 2004/38. *(Social services in Germany)* Art 6 Right of residence for 3 months Art 7 Right of residence for more than 3 months [Express Justifications] [Article 27] confirms the power of the Member States to 'restrict the freedom of movement and residence of Union citizens and their family members, irrespective of nationality, on grounds of public policy, public security or public health' Week 8 Competition Law Art 101 TFEU 1. Prohibits collusions between undertakings that are anti-competitive by object or effect 2. determines that illegal collusive practices are automatically void and thus cannot be enforced in Court 5 cumulative steps: - Are there undertakings involved? - Is there collusion between those undertakings? - Does this collusion have an appreciable object or effect of restricting competition? - Does this collusion have an appreciable effect on trade between member states? - Can the collusion be exempted? 1. **Undertaking** (= every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed) - *Höfner Case*: Definition of undertaking. The ruling established that the test for being an \"undertaking\" is whether the entity is offering goods or services in a market, not whether it is publicly funded or has regulatory functions. - **economic activity** (= 'any activity consisting in offering goods or services on a given market is an economic activity) - A private body may not count as an undertaking where it is engaged in 'a task in the public interest which forms part of the essential functions of the State **2**. **Collusion** =\> Agreements must be **multilateral**: Horizontal and vertical agreements - **horizontal agreements** are agreements between undertakings that are competing against each other; that is: companies placed at the same horizontal commercial level - **Vertical agreements**, by contrast, are agreements between undertakings at different levels of the commercial chain; that is: agreements between companies not competing against each other (producer distributer relation etc.) Every agreement must be concluded by **consent of the parties (=concurrence of two or more wills)** **3**. Agreements must have and **interstate dimension** otherwise they will be outside the sphere of EU competition law. -- potential effects of a national agreement on trade between MS (=contextual view of agreement) 4\. **The agreement must be anti- competitive** - Restrictions by Object (per se rules) - Restrictions by Effect (here agreements do not contain clauses that are per se restrictions, Article 101(1) requires detailed proof of the agreement's anti-competitive effect) **De minimis rule** (the law shall not concern itself with trifles) - Art 101 does not seek to establish perfect competition but only workable competition -- minor market imperfections will thereby be tolerated - Restrictions on competition will only fall within Article 101 (1) where they do so to an appreciable extend - [10 per cent aggregate market share for the parties to horizontal agreements] - and a [15 per cent aggregate market share for parties to vertical agreements] will not appreciably restrict competition within the meaning of Article 101(1). 5\. **Can the collusion be exempted?** Art 101 (3) - improving of production - allowing consumers a fair share of the resulting benefit - does not impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives - does not afford to such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question **Art 101 (2)** Any agreements or decisions that restricts competition under the aforementioned criteria is automatically void - Commission must not render void without any valid reason, all clauses of the agreement (Grundig Consten v Commission) Consten Grundig v Commission: - Also vertical agreements can violate EU law. - Clear benefits have to outweigh anti-competitive effects.