Introduction
The free movement of goods is one of the fundamental components of the European Union single market. However, there are different challenges experienced in the operation of the EU single market largely due to the competing national interests between the member states. Efforts to streamline the operation of the EU single market led to the formulation of different rules and regulations under the Treaty of Functioning of the European Union. Parties negatively affected by the existence of competing for national interests by the member states can seek redress under the TFEU.[1] This paper entails advice provided to IRECO, an Irish company that exports high-quality beef products throughout the EU on the legality of the actions taken by some of the member of states under the EU law and the means of the redressing the issues.
Legal analysis of the scenario
The imposition of a quota by the Danish government allowing only 50,000 units of foreign beef products a year to enter Denmark to try and help boost domestic production and enhance food security in the event of a possible food crisis in the future constitutes a quantitative restriction. Article 34 of the TFEU restricts the imposition of quantitative restrictions on imports, either total restriction (ban) or partial restriction or a quota, on imports.[2] The imposition of the quota on the ground that the Danish government was concerned about the country’s food security in the event of a future food crisis constitutes a discriminatory quantitative restriction against the Danish firm, IRECO.
Article 34 of the TFEU restricts the implementation of measures that have an effect that is equivalent to quantitative restrictions.[3] An example of such restriction includes the implementation of any administrative practice in the form of state rules and laws or practices undertaken by state-supported bodies. In the case of Salgoil SpA v Italian Ministry for Foreign Affairs[4], the European Court of Justice held that the imposition of import quotas against an EU member state amounts to a breach of Article 34 of the TFEU. In respect to this, IRECO should consider suing the Danish government on the ground of discriminative quantitative restrictions. The imposition of the quota would mean that IRECO would experience competitive disadvantage against local Danish companies in supplying beef products in Denmark.
IRECO may further seek legal redress under Article 34 of the TFEU against the Spanish government requirement that all beef imports into the country are to be accompanied by an import licence following some newspaper reports of a mystery disease in cows in certain parts of West of Ireland. In challenging this requirement, IRECO should argue that the requirement constitutes a MEEQR, hence contravening article 34 of the TFEU. In supporting its argument, IRECO should cite the case of International Fruit Co NV v Produktschap Voor Groenten en Fruit.[5] In this case, the court held that a licensing system adopted by a country may amount to a quantitative restriction if it is in breach of Article 34 of the TFEU.[6] In the case of Procureur du Roi v Dassonville[7], the European Court of Justice affirmed that the requirement for a party to have a certificate of origin to export goods into an EU member constitutes a MEEQR and might hinder trade between the member states. The court’s judgement was about the Dassonvillle formula that prohibits all trading rules instituted by a particular EU member state that may directly or indirectly limit intra-community trade.[8]
In its trade with Germany, IRECO does not have an option rather than comply with the Italian government requirement for all beef products to contain no more than 15% fat and the clear labelling on its compliance with this requirement. Moreover, IRECO must also ensure that it complies with the ban on an advertisement featuring beef burgers on newspaper and magazines to safeguard its citizens’ health and ensure environmental sustainable methods of food production. The EU law stipulates that trading between the EU member states should be conducted reasonably as stipulated under the case of Cassis de Dijon[9] in which a German applicant was denied permission to import Cassis de Dijon due to the failure to comply with the German requirement on the composition of the product.[10] In making a ruling over the case, the ECJ took into consideration the principle of the rule of reason. Under the rule of reason, it is permissible for a country to restrict trade based on ‘mandatory requirement’ to protect public health. As such, Germany was legally right to impose import requirement on beef imports to enhance public health.
Similarly, IRECO may also take legal action against Germany for not making a reasonable effort to clear the roads following their blockage protesting local farmers complaining about the import of beef from other EU member states and sold at a lower price compared to domestically produced beef. The failure by an EU member state to caution against the occurrence of illegal interference of free movement of goods may constitute a discriminatory quantitative restriction under Article 34 of the TFEU. This assertion is underlined by the ruling in the case of Commission v France[11] , in which the French government failed to thwart the violent demonstration held by French farmers who were complaining against the import of agricultural products from EU member states. The protesters intercepted the truck drivers, and damaged shops owned by French citizens. In making a ruling, the ECJ argued that the French government contravened Article 4 of the TFEU, which stipulates that all EU member states are obliged to undertake the necessary measures towards the fulfilment of treaty obligations amongst them facilitating free movement of goods.
Conclusion
The analysis of the scenario highlights that IRECO can successfully seek legal action against the EU member states that have imposed national laws that are contrary to the TFEU bb taking into account the legal issues articulated above. However, the firm must also ensure that it complies with the mandatory requirements implemented by EU member states on the ground of enhancing public health.
References
Cahil Dermot and Vincent Power. European law (Oxford: Oxford University Press, 2011).
Hargreaves Sylvia and Matthew Homewood. EU law concentrate; law revision and study guide (Oxford: Oxford Univerity Press, 2013).
Nigel Foster. Foster on EU law (Oxford: Oxford University Press, 2015).
Schutze Robert. European Union law (Cambridge: Cambridge University Press, 2015).
Wolf Susan. Briefcase on European community law (London: Cavendish Publishing, 1999).
Woods Lorna, Phillippa Watson and Marios Costa. Steiner and woods EU law (Oxford: Oxford University Press, 2017).
Case law
Salgoil SpA v Italian Ministry Of Foreign Trade [1968] ECR 453.
International Fruit Company v Produktschap voor Siergewassen, Court of Justice of the EC, [1972] ECR 1219
Procureur du Roi v Dassonville (Case 8/74) [1974] ECR 837.
Rewe-Zentral AG v Bundesmonopolverwaltung fur Branntwein (case 120/78) [1979] ECR 649 (Cassis de Dijon)
Commission v France (Case C-265/95) [1997] ECR I-6969.
[1] Robert Schutze. European Union law (Cambridge: Cambridge University Press, 2015) 534.
[2] Sylvia Hargreaves and Matthew Homewood. EU law concentrate; law revision and study guide (Oxford: Oxford Univerity Press, 2013) 98.
[3] Lorna Woods, Phillippa Watson and Marios Costa. Steiner and woods EU law (Oxford: Oxford University Press, 2017) 387.
[4] Salgoil SpA v Italian Ministry Of Foreign Trade [1968] ECR 453.
[5] International Fruit Company v Produktschap voor Siergewassen, Court of Justice of the EC, [1972] ECR 1219
[6] Susan Wolf. Briefcase on European community law (London: Cavendish Publishing, 1999) 96.
[7] Procureur du Roi v Dassonville (Case 8/74) [1974] ECR 837.
[8] Dermot Cahil and Vincent Power. European law (Oxford: Oxford University Press, 2011) 48.
[9] Rewe-Zentral AG v Bundesmonopolverwaltung fur Branntwein (case 120/78) [1979] ECR 649 (Cassis de Dijon)
[10] Nigel Foster. Foster on EU law (Oxford: Oxford University Press, 2015) 285.
[11] Commission v France (Case C-265/95) [1997] ECR I-6969.