European Union Law on Free Movement of Goods, Customs Duties, and Internal Taxation
Qstn 1: An Italian measure banning the import of sheep from Germany and Austria where there have recently been outbreaks of the highly contagious Mutton Flu, a disease which could potentially be transmitted from animals to humans.
Notably, the European Union boasts of its ability to react quickly to in response to disease outbreaks that may lead to further infection. As the world largest trade front, Pirker (2012) states that the Union has established measures that protect the nations’ livestock and humans from contracting diseases from export of animals and animal products. Measures include a harmonized surveillance among other controlled measures. This includes all types of microorganisms like viruses, bacteria, parasites, among other animal diseases.
The case presented that bans import of sheep from Germany and Austria due to recent attacks of the highly contagious mutton flu poses the question whether such a move is legal, or it violates the TFEU provisions. Article 34 TFEU provides a horizontal direct effect concerning such situations that may affect the free movement of goods in the EU (Pirker 2012). This means that the member states are provided with certain law privileges that allow them to provide restrictions. This is often allowed in a case where there is a strong possibility that a particular conduct would effectively address a particular scenario providing a particular measure (para 188).
Consequently, the commission would not have a good case to bring proceedings for breach of treaty provisions to the Italian government. This because the Italian government would only be protecting its animal and human population against imminent threats which is one of the core provision in TFEU. Even if the EU was formed for the benefit of free movement of good, the objectives of the EU animal health policy outlined in the EU AHS 2007-2013 provide an alternative. It provides that the public health and food safety be upheld by minimizing incidences of biological and chemical attacks to humans. Therefore, Pirker (2012) statuses those provisions of the TFEU harmonizing free movement of goods, which include Articles 28, 30, 34, 35, and 110 TFEU, may not be effective due to the legal category of the case.
Qstn 2: A German measure which states that all vegetarian sausages should be packaged in green plastic boxes measuring 20 x 20 cm. This is to distinguish vegetarian sausages from sausages containing meat.
Dongo (2011) provides evidence that numerous provisions have been established governing the labelling, advertising, nutritional value and general nature of labelling foodstuffs across the European Union. Nevertheless, these provisions are numerous and scattered all over EU and national legal sources which provide either horizontal or vertical scope of the ruling. Due to their wide nature and broad interpretations, the laws may sometimes be interpreted or applied inconsistently across nations.
Over the years, the range of food products across food shelves has significantly increased. Along with the range of foods, Dongo (2011) argues that the consumers have become even precise and more specific about the type of goods or products that they wish to purchase from food stores. Some of these habits have risen due to conformist who aims to combat unhealthy lifestyles, which include eating meat. Others are even meticulous with an effort to reduce lifestyle diseases like cancer and diabetes, which have increased dramatically over the years. As a result, the commission has deemed appropriate for the consumers to be provided with accurate information on energy, nutritional value, and even origin of the food products.
A Germany measure that states all vegetarian sausages should be packed in green plastic boxes measuring 20 x 20 cm may be viewed as an effort to provide much needed information about the origin and nutritional content of the food product, in this case a sausage. It does not in any way contradict the Article 34 provision that provides free movement of goods. In addition, if a member state provides for more or less restrictive rules than those of other members states will result to incompatibility with the EU law (case C-294/00 para 46) (Dongo 2011). This reveals that a choice by one member state in a system of protection different from the rest of the member states does not influence proportionality of the contested provisions.
Qstn 3: A Polish provision, which taxes naturally, fermented apple cider vinegar at 5% and synthetically manufactured apple cider vinegar at 13%. Poland produces 80% of the fermented apple cider vinegar that it consumes, but does not produce any synthetically manufactured apple cider vinegar. The rationale behind this measure is to encourage the production of the natural product in order to preserve the finite resource of the petroleum-based substances used in the synthetic production.
Sadeleer (2013) argues that the European Union member states are allowed to carry out their own tax policies if it is only for the benefit of environmental conservation. However, caution must be taken to prevent the governments from using these taxes to influence customer’s consumer behavior or even provide protection for domestic products. In such a case, the TFEU provisions are likely to prevent such fiscal instruments even if they are aimed at protecting the environment.
The sections B and C address two separate situations that limit the use of taxes to for the benefit of the environment. Articles 28 and 30 TFEU on the free movement of goods allows member states to charge extra taxes or custom duties on imports or exports if it was to benefit the environment (Sadeleer 2013). Article 110 further clarifies it to state that second category internal taxations, which result to a discriminatory nature, are condemned. Therefore, in this case, the commission will have to distinguish Articles 28 and 30 TFEU, which allows additional taxation from Article 100, which protects the producers from discriminatory internal taxation (Sadeleer 2013).
The courts of justice have not often had to adjudicate cases that are related to local measures on the protection of the environment. However, Sadeleer (2013) argues that this case is very important because it presents a case of potential conflict between the worldwide effort to combat environmental degradation and legislation that may affect the free movement of goods. The case at hand presents the two possible scenarios that have been discussed above. First, the Polish government has increased taxes on synthetically manufactured apple cider with the rationale that encouraging the natural product will preserve the reserve of petroleum-based fuel used in the synthetic manufacture. However, since over 80% of the local market consumes the naturally fermented apple cider, the increased taxation would be viewed as an effort to influence consumerism. As a result, the commission would have a case against the Polish government.
Qstn 4: A Bulgarian law which states that all slimming pills must be sold by Government regulated retailers. This is to combat the growing instance of dangerous, sub-standard products on the market. These retailers, however, only open from 9am-2pm, Tuesday to Friday.
European Commission (2014) establishes that Article 114 TFEU aims to facilitate freedom of trade in the internal environment, besides protecting non- merchant issues. As Articles 114 (4) to (10) TFEU provides, members states are allowed to provide reinforced protection to the people of their country. Article 192 also provides flexibility for other measures that involve regulation of products even if it is detrimental to total harmonization (European Commission 2014). Using this basis, the Bulgarian law is in total harmony with TFEU provisions to regulate slimming pills to government-regulated retailers for a certain period.
In retrospect, the Grandfather restrictions of Article 64 (1) TFEU allows member states to continue to apply restrictions with regard to third countries in like in the case of Bulgaria, Estonia, and Hungary (European Commission 2014). In addition, the public policy or public security measure is also provided by Articles 65 (1b) and 52(1). This gives member states the mandate to take restrictive measures if they are justified by public policy or public security reasons (European Commission 2014).
Nevertheless, the TFEU interpretation may differ in and may raise controversies if a state hinders free circulation of goods by enacting regulations of its sale by merchants. These controversies arise from diverse interpretations of the TFEU provisions. However, in regard to the provisions discussed above, the Bulgarian government has more than enough reason and legality to restrict the sale of slimming pills if it means that it will prevent dangerous and substandard products from getting into the market. Despite the fact that this will contradict the Article 34 TFEU, it is a measure that a member state has to take in order to protect its citizens (European Commission 2014). As a result, the commission will have no case against the Bulgarian government.
Qstn 5: Belgium has passed a law stating that pheasants may only be sold by butchers who have successfully obtained a certificate from the Food Standards Agency permitting them to sell pheasants.
All trading rules enacted by member states which may hinder, directly or indirectly intra-trade union are to be regarded as measures that harbor quantitative restrictions. Staffordshire University (2014) provides a good example as the Procure du Roi v Dassonville (Case 8/74) [1974] EUR 837 which was a case that established quantitative restrictions of Scotch whisky importers under the Belgian law. The commission ruled it was legal for a member state to employ measures for authenticating the origin or safety of the product in the absence of a regulating union. However, proof should be provided that shows these measures do not hinder trade between member states. For example, in the case above, Staffordshire University (2014) writes that the commission found that the restrictive law hindered the free movement of goods from one member state to another and therefore the ‘rule of reason’ developed.
There are two sets of exceptions to Articles 44 and 29 TFEU, which distinctively differentiate the two types of MEQRs (Measure Equivalent to a Quantitative Restriction). Article 2 of directive 70/50 refers to distinctively applicable MEQRs which distinguish between domestic and imported products. Secondly, the article 3 refers to measure that affect both imported and domestic products (Staffordshire University 2014). This is classified under the mandatory requirements.
In this case, the mandatory requirement for all butchers to have licences before selling pheasants does not regard if it is distinctive or indistinctive application of the MEQR because pheasants are not locally available. As provided in the rule of reason, it is important to note that this legislation is enacted to prevent the black market of these pheasants, which originate from Asia. The black market would result to increment of prices as well as sale of untested products, which may lead to the outbreak of diseases and the like. Ultimately, all the government is doing is for the good of the people and the commission would, therefore, not have a case.
References
Dongo, D. (2011). Origin, nutrition, declaration, ingredients all the novelties of the new EU regulation: The Food Label, 1- 55. Retrieved from: http://ilfattoalimentare.it/downloads/thefoodlabel.pdf
European Commission. (2014). The relevant treaty provisions on the free movement of capital and third countries: The EU Single Market. Retrieved from: http://ec.europa.eu/internal_market/capital/third- countries/treaty provisions/index_en.htm
Pirker, B. (2012). Case C-171/11FRS.BO: Horizontal effect of ARTICLE 34 TFEU. Retrieved from: http://europeanlawblog.eu/?p=679
Sadeleer, N. (2013). Environmental regulatory autonomy and the free movement of goods: Environment and Internal Market, 1(1), 1-33. Retrieved from: http://www.tradevenvironment.eu/uploads/JM_Paper_2013_1.pdf
Staffordshire University. (2014). Study plan 3- the free movement of goods in the European Union: Law School, 1-38. Retrieved from: http://www.staffs.ac.uk/assets/EU%20Law%20- %20Study%20Plan%203_tcm44-50234.pdf
