The these treaty provisions have been found to have

The ECJ held that the license requirement fell within the remit of Article 34; it was a measure having equivalent effect to a quantitative restriction (‘MEQR’). Consequently, it can be said it was classified as neither a product rule nor a selling arrangement. It was reiterated that although the measure applied to both domestic and imported goods and did not formally discriminate between the two, it was still capable of falling within the scope of Article 34.

 

It is well established that a national rule which inhibits Intra-Community trade is justifiable under Article 36 or if it is classed as a selling arrangement. The Court concluded that neither was the case here. Arguments for the protection of public health and consumers were rejected and the legislation deemed unnecessary to achieve quality food. The equipment requirements of a flour store and kneading area imposed unreasonably high costs and went beyond what was needed to achieve the specified objective. 

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Article
34 states, ‘quantitative restrictions on imports and all measures having
equivalent effect are prohibited between Member States’. As the main purpose of
free movement of goods legislation is to prevent interference with the internal
market, these treaty provisions have been found to have direct effect. The
Court first attempted to provide a canonical definition of MEQR’s in Dassonville; they are all rules
enacted by Member States, which are capable
of hindering Intra-Union trade1. This
was significant because the definition widened what constituted an MEQR.
Merely, the propensity for a measure to have a restrictive effect renders it
within the scope of Article 34. Similarly, Van
de Haar2 and Bluhme3
established that there is no de minimis test in Article 34; no matter how small
the effects of legislation are, it can still come under Article 34 if it is an
MEQR. When analogising these cases with Alfa
Vita it would appear the reasoning provided by the Court is consistent.
The requirement for a flour store and kneading areas for the marketing of
‘bake-off’ products was considered unnecessary. It subject traders to high
costs because it imposed traditional bakery manufacturing requirements on them.
As this was considered discriminatory and a barrier to Intra-Community trade,
it was held to be a Dassonville
type MEQR.

 

In
addition to this, the Court briefly referred to Cassis de Dijon4
when discussing the mandatory requirements which reverse the presumption of
lawfulness. It holds that an indistinctly applicable measure may be justified
on public interest considerations. However, in Alfa Vita, this was not found to be the case because the
license requirement was too far reaching. The minimum alcohol requirement in Cassis concerned the way in which
products were produced or packaged, thus being a product rule. Contrastingly,
the Alfa Vita license
requirement concerned the product at point of sale. It can therefore still be
maintained that the decision of the Court in Alfa Vita was in line with Cassis because the requirement for a prior license applied
without distinction.

 

According
to Keck and Mithouard5
rules relating to selling arrangements fall outside of Article 34. This is only
where the measures apply to all traders and affect the marketing of domestic
and community products in the same manner in both law and fact. This proviso in
Keck introduced the criteria
of discrimination when the measure was distinctly applicable and indirectly
discriminatory. Looking strictly at Keck,
consistency of the Court is evident; the contested legislation amounts to an
infringement of Article 34 because it is not a selling arrangement. It requires
‘bake-off’ goods traders to obtain a license under the same conditions as traditional
bakery traders. It is a rule which aims to control the production conditions of
a product but does not regulate the conditions for their sale. This is clear as a license could only be granted if certain equipment
was installed and requisite procedures followed. Attorney General (‘AG’) Maduro
further states that although the Greek government contends the legislation was
a selling arrangement, this could not have been6.
This is because the conditions of compliance are part of the production process
and do not relate to the specific characteristics of ‘bake-off’ goods. If the
legislation was applied it would prevent the products being sold in outlets
other than traditional bakeries. Following from this, it would appear at first
instance the Court ruled in line with Keck
when stating that this is not a selling arrangement.

 

Moreover, further
coherence is evidenced in the decision of the Court to look at the importance
of proportionality. Any derogation that is argued to be valid must be strictly
interpreted. Therefore, any measure must be shown to be proportionate to the
objective is seeks to achieve. In Alfa
Vita, the Greek government stated that even though hygiene rules were
observed in the first manufacturing stage, this did not mean they were
redundant in the final stage of production. AG Maduro maintained that even if
this was accepted it appears disproportionate to have an identical licensing
procedure and manufacturing requirement for both sales outlets. Particularly of
concern is the condition of flour store and kneading area because these do not
concern ‘bake-off’ goods specifically. Although it would have been acceptable
to have a license requirement for such products, it would require adaption which
takes into account their specific characteristics. Additionally, a prior
license is not a proportionate requirement when the primary aim is to improve
quality. In order for a provision to justify a hindrance to the free movement
of goods, it would need to be considered alongside another derogation present
in Article 36.

 

Nevertheless, it
is difficult to deny that the application of case law in this area has led to
uncertainty when taken together. Although the Court follows its rulings in Cassis, Dassonville, Van de
Haar and Keck, the Alfa Vita decision is
inconsistent with Morellato7
and Commission v Greece8.
Having relied on the Keck analysis above, it should be noted the Court does not
mention that the license requirement in Alfa
Vita restricts the sale of ‘bake-off’ products to certain outlets
(bakeries). This would have an effect on the sale of products and ought to
constitute a selling arrangement under the reasoning provided by Keck, Morellato and Commission
v Greece.

 

In Morellato the Court dealt with a
similar situation; an Italian rule demanded ‘bake-off’ goods be prepackaged and
labelled before being sold. The product was designed to be baked before sale. As
packaging takes place after the final bake, this obligation does not restrict
the use of the product. It is clear therefore that Article 34 does not apply in
such a situation. Similarly, in Commission
v Greece the Court found national legislation with restricted the sale
of infant milk to pharmacy outlets also constituted a selling arrangement. Yet,
the Court did not comment on the distinguishing features of these cases. Even
prior to the Keck proviso, it
was held in Quietlynn9
that the restriction of sex articles to licensed sex shops did not fall within
the ambit of Article 34. The Greek legislation in question simply restricted
the sale of ‘bake-off’ goods to certain outlets, this is an archetypal selling
arrangement, rendering it difficult to reconcile with previous case law.

 

Although it is clear that Alfa Vita was used by the Court
to widen the scope of Article 34, it has merely exposed inconsistencies
regarding laws about the free movement of goods.

1 Ibid.

2 Joined Cases 177 and 178/82 Jan
van de Haar and Kaveka de Meern BV ECLI:EU:C:1984:144

3 Case 67/97 Bluhme
ECLI:EU:C:1998:584

4 Case 120/78 Rewe-Zentral AG v
Bundesmonopolverwaltung für Branntwein ECLI:EU:C:1979:42

5 Joined cases C-267/91 and C-268/91 Bernard Keck and Daniel Mithouard ECLI:EU:C:1993:905

6 C- 158 and 159/04 Alfa Vita
and Carrefour Marinopoulos AE Opinion of Advocate General

Poiares Maduro ECLI:EU:C:2006:212
(paragraph 15)

7 Case C-416/00 Tommaso
Morellato and Comune di Padova ECLI:EU:C:2003:475

8 Case C-391/92 Commission of
the European Communities v Hellenic Republic ECLI:EU:C:1995:199

9 Case C-23/89 Quietlynn
Limited and Brian James Richards v Southend Borough Council ECLI:EU:C:1990:300