User:Kaihsu/IMlawB3

European internal market.

Module B: Equal treatment and non-discrimination.

Chapter 3: Treaty-based limitations and exceptions to the market freedoms.

General framework
Discrimination directly on grounds of nationality can be permitted only if it comes within one of the exception clauses of the Treaty or relates to a matter which falls outside the material scope of the Treaty. By contrast, discrimination indirectly on grounds of nationality and therefore is capable of justification. The reasoning can be transposed from one area to another: Case 48/75 Royer.

The Court interprets the express Treaty exceptions from the prohibitions narrowly and the listing of grounds there is said to be exhaustive (Irish souvenirs) for discriminatory measures. In contrast, for indistinctly applicable measures, there are augmented by judge-made public-policy "mandatory requirements" for which exhaustive listing seems impossible.

Free movement of goods
"The provisions of Articles 34 and 35 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified 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": Article 36 TFEU.

"The traditional view was that a Member State could not justify a disciminatory measure on grounds other than those listed in Article 36, even if the justification was in the list that could be invoked for indistinctly applicable measures [so-called 'mandatory requirements']": Craig and de B&uacute;rca (emphasis added).

The defence of necessity is not recognized: Case 7/61 Commission v Italy (pork imports). List of grounds in Article 36 TFEU is exhaustive: Case 113/80 Commission v Ireland (Irish souvenirs). The measure must be proportionate: Case C-366/04 Schwarz.

Public morality
A ban on import of obscene goods may be applied even if the laws enforced is locally varied: Case 34/79 Henn and Darby. But if there is no domestic prohibition of manufacture or marketing of the same goods, ban on import is prohibited: Case 121/85 Conegate.

Public policy
One rare example of acceptable exception on public policy grounds is export of coins for melting down: Case 7/78 Thompson. Even consumer protection is not a justifiable ground: Case 177/83 Kohl v Ringelhan.

The Member State must adopt measures to safeguard the freedom: Case C-265/95 Commission v France (Spanish strawberries); see subsequent Regulation 2679/98. The Court saw the fundamental right to protest as a free-standing public-interest ("mandatory") requirement to be balanced against the freedom of movement (rather than a public-policy derogation): Case C-112/00 Schmidberger.

Public security
"The purpose of Article 36 of the treaty is not to reserve certain matters to the exclusive jurisdiction of the member states; it merely allows national legislation to derogate from the principle of the free movement of goods to the extent to which this is justified in order to achieve the objectives set out in the article. Article 36, as an exception to a fundamental principle of the treaty, must be interpreted in such a way that its scope is not extended any further than is necessary for the protection of the interests which it is intended to secure and the measures taken pursuant to that article must not create obstacles to imports which are disproportionate to those objectives. [...] The rules adopted for that purpose must be justified by objective circumstances corresponding to the needs of public security. Once that justification has been established, the fact that the rules are of such a nature as to make it possible to achieve, in addition to the objectives covered by the concept of public security, other objectives of an economic nature which the member state may also seek to achieve, does not exclude the application of Article 36"; the restricting measure must transcend "purely economic considerations": Case 72/83 Campus Oil. But discrimination where the objective could have been achieved by less restrictive measures is prohibited: Case C-398/98 Commission v Greece (minimum petroleum stocks), confirming Campus Oil.

Restriction on strategic goods must be proportionate: Case C-367/89 Aimé Richardt. The public security concern may be related to foreign policy and centred on a third country or the international community at large: Case C-70/94 Werner. Restriction can only be justified if any violent reaction cannot be controlled otherwise: Case 231/83 Cullet v Centre Leclerc.

Public health
Public health ranks "first among the properties or interests protected" by Article 36 TFEU; Court is reluctant to override Member State assessment on pharmaceuticals: Case 104/75 De Peijper (pharmaceutical parallel imports); also see Case 238/82 Duphar v Netherlands (pharmaceutical black list). But a Member State cannot simply disregard health certification by another: Case 272/80 Frans-Nederlandse Maatschappij voor Biologische Producten, Case 124/81 Commission v UK (UHT milk), Case C-304/88 Commission v Belgium (live cattle). Precautionary ban is acceptable with scientific review (e.g. with data from FAO, WHO) within a reasonable time: Case 178/84 Commission v Germany (beer).

Disproportionte restrictions or those that are ineffective in achieving its stated goals are prohibited: Case 174/82 Officier van justitie v Sandoz BV, confirmed by Case C-170/04 Rosengren (private import of alcohol), Case C-143/06 Ludwigs-Apotheke (lists of non-approved medicinal products) confirming but not applying Case C-320/03 Ortscheit, Case C-421/09 Human plasma (ban on blood products where donor paid), Case C-108/09 Ker-Optika (internet contact lens sales).

Animal and plant health
This can be broken down into three subheadings:
 * prevention of diseases: Case 40/82 Commission v UK (Newcastle disease)
 * protection of rare or endangered species: Case C-169/89 Gourmetterie van den Burg
 * animal welfare: Case 141-143/81 Holdijk, Case C-1/96 Compassion in World Farming.

General concerns as to plant or animal genetic integrity do not come within Article 36 TFEU: Case C-131/93 Commission v Germany (live crayfish imports); but protection of an insular, genetically-recessive subspecies of honeybee is acceptable: Case C-67/97 Bluhme (Lærso brown bees).

Industrial and commercial property
Case C-143/00 Boehringer summarizes the principles: "[...] a trade mark proprietor may rely on its trade mark rights in order to prevent a parallel importer from repackaging pharmaceutical products unless the exercise of those rights contributes to artificial partitioning of the markets between Member States. Where a proprietor relies on its trade mark rights to prevent repackaging where that is necessary for the pharmaceutical products concerned to be marketed in the importing State, that contributes to such artificial partitioning. [...] It is incumbent on the parallel importer himself to give notice to the trade mark proprietor of the intended repackaging. In the event of dispute, it is for the national court to assess, in the light of all the relevant circumstances, whether the proprietor had a reasonable time to react to the intended repackaging."

National artistic, historic or archaeological treasures
Bans and quantitative restrictions are permissible, but not charges on exports: Case 7/68 Commission v Italy (export tax on art treasures). Books and cultural diversity are not grounds within Article 36 TFEU: Case C-531/07 Fachverband der Buch- und Medienwirtschaft v LIBRO; indicative list may be in Council Directive 93/7/EEC.

Free movement of persons
The freedom of movement of workers is "subject to limitations justified on grounds of public policy, public security or public health" (Article 45(3) TFEU) and "shall not apply to employment in the public service" (Article 45(4) TFEU). The right of establishment does "not apply [...] to activities which in that State are connected, even occasionally, with the exercise of official authority" (Article 51 TFEU) and does "not prejudice the applicability of provisions laid down by law, regulation or administrative action providing for special treatment for foreign nationals on grounds of public policy, public security or public health" (Article 51 TFEU). These exceptions also apply for the right to provide services.

Derogations are interpreted strictly; “where a national of a Member State pursues as an employed person within the territory of another Member State activities which may in themselves be regarded as effective and genuine work, the fact that he claims financial assistance payable out of the public funds of the latter Member State in order to supplement the income he receives from those activities does not exclude him from the provisions of [Union] law relating to freedom of movement for workers”: Case 139/85 Kempf.

Article 7(1)(b) of the the Citizens’ Rights Directive (2004/38/EC) requires the migrants to have sufficient resources and sickness insurance; the rest of the article provides for other conditions for the right of residence for more than three months. Article 8(4) prohibits Member States from fixing an amount for "sufficient resources". "An expulsion measure shall not be the automatic consequence of a Union citizen's or his or her family member's recourse to the social assistance system of the host Member State": Article 14(3), codifying Case C-184/99 Grzelczyk. Chapter VI of the directive provides for restrictions on the right of entry and the right of residence on grounds of public policy, public security or public health.

Public policy and public security
"These grounds [for restrictions] shall not be invoked to serve economic ends": Article 27(1) of Directive 2004/38/EC. Article 27(2) of the directive: “Measures taken on grounds of public policy or public security shall comply with the principle of proportionality and shall be based exclusively on the personal conduct of the individual concerned. Previous criminal convictions shall not in themselves constitute grounds for taking such measures. ¶ The personal conduct of the individual concerned must represent a genuine, present and sufficiently serious threat affecting one of the fundamental interests of society. Justifications that are isolated from the particulars of the case or that rely on considerations of general prevention shall not be accepted.”

The proportionality review is developed in Case C-413/99 Baumbast, Case C-200/02 Chen, and Case C-408/03 Commission v Belgium (Portuguese migrants). Article 28 provides for protection against expulsion.

Personal conduct
The principle codified in this provision is directively effective and may be invoked before national courts; restriction for repression of association or dissuation of personal conduct is not permitted: Case 41/74 Van Duyn; "preventive" restriction based on collective behaviour is not permitted: Case 67/74 Bonsignore. Review of "real and sufficiently grave threat", "propensity to offend" constituting such a danger is required: Case 36/75 Rutili, Case 30/77 Bouchereau. Automatic explusion for life without review of whether risk has diminished and difficulties due to expulsion is not permitted: Joined cases C-482/01 and C-493/01 Orfanopoulos.

Listing in Schengen Information System without reason is not permitted: Case C-503/03 Commission v Spain (SIS). Automatic explusion for life without examining why supporting documents for residence application cannot be provided is disproportionate: Case C-408/03 Commission v Belgium. Banning exit to travel to another Member State only by reference to the latter's decision is inadequate ground: Case C-33/07 Jipa.

Non-discrimination
Measures against non-nationals should be matched by similar ones against national counterparts: Joined cases 115/81 and 116/81 Adoui and Cornuaille, overturning Van Duyn; but this does not mean nationals must be expelled, as they cannot be: Case C-348/96 Calfa, confirming Rutili.

Member States are permitted to impose "administrative police measures limiting that worker's right of residence to a part of the national territory, provided
 * that such action is justified by reasons of public order or public security based on his individual conduct;
 * that, by reason of their seriousness, those reasons could otherwise give rise only to a measure prohibiting him from residing in, or banishing him from, the whole of the national territory; and
 * that the conduct which the Member State concerned wishes to prevent gives rise, in the case of its own nationals, to punitive measures or other genuine and effective measures designed to combat it": Case C-100/01 Olazabal.

Expulsion
"An expulsion decision may not be taken against Union citizens, except if the decision is based on imperative grounds of public security, as defined by Member States, if they [...] have resided in the host Member State for the previous ten years": Article 28(3)(a) of Directive 2004/38/EC. Reasons for expulsion must be set out and procedure must be followed: Articles 30 and 31 of Directive 2004/38/EC, codifying Adoui, Rutili, and Case 98/79 Pecastaing. Articles 32 (codifying Adoui and Calfa) and 33 deals with the duration and review of exclusion orders and expulsion.

"To assess whether the interference contemplated is proportionate to the legitimate aim pursued, in this case the protection of public security, account must be taken in particular of the nature and seriousness of the offence committed, the duration of residence of the person concerned in the host Member State, the period which has passed since the offence was committed and the conduct of the person concerned during that period, and the solidity of the social, cultural and family ties with the host Member State. In the case of a Union citizen who has lawfully spent most or even all of his childhood and youth in the host Member State, very good reasons would have to be put forward to justify the expulsion measure"; national courts can look for absences during which integration may be lost; such grounds must be proportionate: Case C-145/09 Tsakouridis. Propensity to constitute a danger to security must be shown: Case C-348/09 P.I.

Formalities and procedures
"The Member State which issued the passport or identity card shall allow the holder of the document who has been expelled on grounds of public policy, public security, or public health from another Member State to re-enter its territory without any formality even if the document is no longer valid or the nationality of the holder is in dispute": Article 27(4) of Directive 2004/38/EC. A Member State must accept proof of nationality by other means than ID cards or passport for foreigners if nationals can do so: Case C-215/03 Oulane.

If State security stands in the way of disclosing the grounds for resticting rights, the information may be withheld from that individual but they must be told of the essence of the grounds of the decision taken against them so that they can challenge that decision: Case C-300/11 ZZ, interpreting Article 30(2) of the Citizens’ Rights Directive.

Public health
The exemption cannot be used to exclude health workers: Case 131/85 G&uuml;l. See Article 29 of Directive 2004/38/EC.

Public service
Article 45(4) means civil servants are workers under the Treaties: Case C-71/93 Van Poucke. The exemption applies functionally, only to the exercise of official authority; discriminatory conditions of employment within the public service are prohibited: Case 152/73 Sotgiu v Deutsche Bundespost. The test is whether they "[both] exercise powers conferred by public law [and discharge] duties designed to safeguard the general interests of the state", so this also covers municipal authorities; interpretation must be proportionate (consider e.g. regular or occasional exercise of power): Case 149/79 Commission v Belgium (interim) as restated by Case 225/85 Commission v Italy, Case 66/85 Lawrie-Blum, Case C-473/93 Commission v Luxembourg. See Commission communication Freedom of movement of workers and access to employment in the public service of the Member States — Commission action in respect of the application of Article 48(4) of the EEC Treaty OJ 1988 C 72/2, whose approach is followed in Case C-47/02 Anker and Case C-405/01 Spanish merchant navy.

Transitional arrangements relating to free movement
The Court interpreted the stand-still rules in the acts of accession in favour of free movement: Case 77/82 Peskelogou, Case C-279/89 Commission v UK (restriction of Spaniards as fishermen on British vessels). Likewise for transitional arrangements: Case C-9/88 Lopes da Veiga. Experience acquired before accession must be considered: Case C-195/98 Österreichischer Gewerkschaftsbund.

The public service derogation
Professional activities involving contact, even regular and organic, with the courts, including even compulsory cooperation in their functioning, do not constitute a connection with the exercise of official authority: Reyners. The design, programming, and operation of data-processing systems were of a technical nature and were thus unrelated to the exercise of official authority: Case C-3/88 Commission v Italy. These cases set the tone for later cases.

Article 52 TFEU: general considerations
National rules which are not indistinctly applicable to the provision of services irrespective of their origin are only compatible with EU law if they fall within an express derogation such as Article 52 TFEU, and that such derogations cannot be invoked to pursue economic objectives: Case C-288/89 Stichting Collectieve Antennevoorziening Gouda.

Public policy
Article 52 TFEU must be interpreted in such a way that its effects are limited to that which is necessary in order to protect the interests which it seeks to safeguard: Case 352/85 Bond van Adverteerders, confirmed in Case C-3/88 Commission v Italy.

Public security
Spanish legislation subjecting the authorisation to carry on private security activities to requirements that a firm’s directors and managers should reside in Spain and that its security staff should possess Spanish nationality are disproportionate and thus cannot be justified: Case C-114/97 Commission v Spain.

Public health
Public health sector cannot be excluded from Treaty freedoms; exception based on the objective of maintaining a medical service open to all must be justified to be necessary: Case C-158/96 Kohll. Later healthcare-related cases followed this line.

Capital and payments
"The provisions of Article 63 shall be without prejudice to the right of Member States:

(a) to apply the relevant provisions of their tax law which distinguish between taxpayers who are not in the same situation with regard to their place of residence or with regard to the place where their capital is invested;

(b) to take all requisite measures to prevent infringements of national law and regulations, in particular in the field of taxation and the prudential supervision of financial institutions, or to lay down procedures for the declaration of capital movements for purposes of administrative or statistical information, or to take measures which are justified on grounds of public policy or public security": Article 65(1) TFEU.

"The measures and procedures referred to in paragraphs 1 and 2 shall not constitute a means of arbitrary discrimination or a disguised restriction on the free movement of capital and payments as defined in Article 63": Article 65(3) TFEU.

Article 65(1)(a) TFEU: fiscal matters
Before the entry into force of Article 65(1)(a) TFEU, "national tax provisions of the kind to which that article refers, insofar as they establish certain distinctions based, in particular, on the residence of taxpayers, could be compatible with [Union] law provided that they applied to situations which were not objectively comparable [...] or could be justified by overriding reasons in the general interest, in particular in relation to the cohesion of the tax system": obiter in Case C-35/98 Verkooijen; so the principle of proportionality would apply when this exception is invoked.

Article 65(1)(b) TFEU: general
Austrian legislation requiring the payment of a stamp duty was essential in order to prevent infringements of national tax law, as provided for within Article 65(1)(b) TFEU: Case C-439/97 Sandoz. Member States’ power to take ‘requisite’ measures to prevent infringement of laws limits permissible restrictions on capital to those necessary to achieve the goal pursued: Case C-302/97 Klaus Konle v Republik Österreich, Case C-478/98 Commission v Belgium (eurobond).

Member States are expressly authorised to have systematic controls in relation to capital for administrative and statistical purposes: contrast e.g. for goods in Case C-186/88 Commission v Germany.

Where the interest invoked by the Member State is not purely economic, it may also serve as a basis to limit the free movement of capital: obiter in Verkooijen. As with other areas of free movement, public policy does not include typically economic interests: AG in Case C-54/99 Église de Scientologie; threats to public security must be described precisely: Scientologie.

Public security permits a government 'golden shares' to guarantee energy supplies in the event of a crisis: Case C-503/99 Commission v Belgium (utilities golden shares). Public security includes external security of a Member State, but was subject to the principle of proportionality and could not permit arbitrary discrimination; for an exception to be justified, it must demonstrated that non-discriminatory treatment of the nationals of all the Member States would expose the military interests of the Member State concerned to real, specific and serious risks which could not be countered by less restrictive procedures.: Case C-423/98 Albore.

Union harmonising legislation
A Member State may not unilaterally adopt corrective or protective measures designed to obviate any breach by another Member State of the (e.g. harmonizing) rules of Union law: Case C-5/94 Hedley Lomas.

Fundamental rights
Since both the Union and the Member States are required to respect fundamental rights, the protection of those rights can justify a restriction of the obligations imposed by Union law, including the freedom to provide services; it was not necessary for the national restriction to correspond to a conception common to all Member States as regards the precise way in which the fundamental right is to be protected: Case C-36/02 Omega.