This Week in Luxembourg

ECJ judgements:

In Scott and Kimberly Clark, the 3rd chamber discussed the interplay between a Community law obligation to recover unlawful state aid and the national administrative law proceedings to make this happen. In this case, there was a potential problem caused by a procedural flaw in the assessments issued.

In a Brussels I case regarding insurance, the 4th chamber ruled that when the defendant makes an appearance the court has to rule that it has jurisdiction even when the rules of art. 8-14 of the Regulation (which deal specifically with insurance contracts) have not been complied with. In those circumstances, art. 24 on tacit prorogation still applies.Bilas.

In Zwijnenburg, the 1st chamber ruled that the Dutch tax on the transfer of real property is not the kind of tax covered by art. 11(1)(a) of Directive 90/434, which allows some of the benefits of that directive (which deals with taxes on mergers & acquisitions) to be suspended when someone uses them for tax evasion.

In a banana/Cartagena Agreement/GATT MFN-clause extravaganza, the 3rd chamber followed the logic of Van Parysand declined to recognise an individual cause of action for those wronged by such international trade law. Ioannis Katsivardas & Nikolaos Tsitsikas.

General Court:

The 8th chamber of the General Court ruled in a stack of competition law cases regarding the copper tubing cartel. InOutokumpu and Luvata, the action for annulment was dismissed. In Boliden AG, as well as in Wieland-Werke and KME Germany, the Commission's counterclaim for an increase in the fine was also rejected. Rather than increase the fines in those cases, the Court elected to reduce them in IMI and in Chalkor, for reasons of the relative seriousness of the infringements of the various companies.

The 8th chamber also upheld the restrictive measures imposed against Pye Phyo Tay Za, an individual associated with the regime in Burma. No unusual arguments were made, except perhaps the applicant's explicit argument that an asset freeze amounted to a criminal sanction. (par. 173-189) Tay Za v. Council.

The 5th chamber rejected an attempt by several Member States to have a Commission "Interpretative Communication" annulled. The manner in which the admissibility of this claim is analysed is curiously (?) detailed, instead of accepting at face value the statement in the opening paragraph that "this communication does not create any new rules". Instead, the Court examined every claim made by the applicants, to see if a "new rule" was adopted. This puts the admissibility analysis dangerously close to the analysis of the merits of the claim. Germany v. Commission.

Opinions:

AG Trstenjak considered two Brussels I cases in the area of consumer protection law: Which country has jurisdiction over a contract agreed over the internet? The AG argues that the mere fact that the website is accessible in the consumer's home country is not enough to give that country's courts jurisdiction over the case. Instead, it depends on a variety of factors that are for the national judge to consider, which may or may not offer sufficient basis for the conclusion that the professional party "direct[ed] his activities to that Member State" (art. 15(1)(c) Regulation). Pammer & Hotel Alpenhof (NL, DE, FR)

Also in consumer protection law, AG Mazák opined on Directive 1999/44: What happens if the product sold to the consumer is not in conformity with the contract through no fault of the seller? Both cases concerned claims by consumers for the costs of removing the defective product where those costs were alleged by the seller to be disproportionate in the sense of art. 3(3) of the Directive. The question is "Disproportionate compared to what?" And what about the fact that in both cases the product was installed by the consumer? The AG's answers generally favour the seller. Gebr Weber and Putz.

Finally, AG Mazák was blessed with a case regarding the Services Directive. Art. 24(1) seems simple enough: "Member States shall remove all total prohibitions on commercial communications by the regulated professions." The Conseil d'État now wants to know whether this means France cannot ban a specific mode of communication for the regulated professions. (In this case: canvassing.) The AG argues that such a ban is still permitted, as long as it is "non-discriminatory, justified by an overriding reason relating to the public interest and proportionate." (art. 24(2) Directive).Société fiduciaire nationale d’expertise comptable

Last Week:

The General Court ruled in an antitrust case about standards setting in the cement industry, an industry not unfamiliar with competition law infringements. In this case, however, the Commission had rejected the applicant's claim that the CEN/TC 51 standard for Portland cement, and the manner in which it had been agreed upon, infringed art. 81 EC. The General Court now holds that, since the procedure was non-discriminator, transparent and open, and since the standard is not even de facto binding, the Commission's decision was correct. EMC Development AB.

AG Trstenjak wrote about the concept of "fair compensation" in the private use exception of the copyright directive, art. 5(2)(b) of Directive 2001/29. After some general discussion of how all aspects of the system used by the MS have to be "fair", and how the system is one of Community Law, but with significant freedom for the MS (i.e. all of it fairly unhelpful), the AG concludes that the Spanish levy system on all storage media is not lawful, "because it cannot be assumed that [they] will [necessarily] be used for private copying". (Cf. the second half of art. 5(2)(b)) SGAE. (Cf. hereand here, in Dutch)

AG Trstenjak also wrote about the right of permanent residence under art. 16 of Directive 2004/38, which a Union citizen obtains after five years of continuous residence in another MS. The case before the UK judge concerned someone who had spent five years in the UK, but prior to the transposition deadline of the directive. Unsuprisingly, the AG argues for the expansive reading of the directive, giving it retroactive force. Only a continuous absence of more than two years can cause the right of permanent residence, once obtained, to vanish again. Cf. art. 16(4) of the Directive. Lassal (NL, FR, DE)

In other news, the Commission handed down € 331 million worth of cartel fines in the computer chip industry (BBC) and France, the Conseil Constitutionnel seems to have disentangled a potentially nasty problem of multilevel governance regarding French constitutional prejudicial questions vs. the European kind. (Adjudicating Europe part 1 and part 2. The decision of the Council is here.)

This Week in Luxembourg

The Grand Chamber this week ruled in a Brussels I case, concerning the overlap between the EU rules on jurisdiction in civil matters and specific treaties that concern the same problem, in this case the Convention on the Contract for the International Carriage of Goods by Road. The Court's conclusion was that the CMR Convention did apply here, since generally lex specialis treaties such as this one apply as long as their rules are of sufficient quality (my word) and as long as they don't get in the way of free movement. The ECJ does not, however, have jurisdiction to interpret the CMR Convention. TNT Express.

ECJ judgements:

In a welcome piece of good news for airlines everywhere, the Third Chamber interpreted art. 22(2) of the Montreal Convention, which limits the damages an airline might have to pay regarding damaged, missing luggage to 1000 Special Drawing Rights, as covering both material and non-material damage. Since the value of an SDR currently stands at about € 1,15, that means mr. Walz can only claim € 1150, instead of being able to claim an additional € 500 in non-material damage. Walz v. Clickair.

Also in the Third Chamber, Poland lost an infringement proceedings, because it failed to carry out a detailed market analysis before engaging in price regulation in the high speed internet market, in violation of art. 16 and 17 of Directive 2002/22. Commission v. Poland (FR)

General Court:

In the General Court, Judge Dehousse rejected an action for annullment brought by the City of Napoli. (Cf. art. 11(1)(3) and art. 14(2)(1)(b) of the Rules of Procedure of the General Court for an explanation as to how a single judge came to hear this case.) The City's objection was against a decision by the Commission to reduce certain Regional Development funds. City of Napoli v. Commission.

Opinions:

AG Sharpston wrote an opinion clarifying the notion of transferring an undertaking in its entirety, preserving its autonomy, since this is important in the context of Directive 2001/23 on employees' rights in the event of transfers of undertakings. UGT-FSP

AG Kokott argued that men, too, should be able to get breastfeeding leave, citing Directive 76/207. Roca Álvarez.

She also discussed a Danish case about potential age discrimination, since the golden handshake given to employees upon their dismissal was calculated taking into account whether the employee was entitled to a (state) pension. Applying Directive 2000/78, she concludes that such an approach would generally be unlawful. Ole Andersen (NL, FR,DE)

This Week in Luxembourg

ECJ judgements:

As was to be expected, the ECJ found the British treatment of the spouses of people on the terrorism list to be a bit harsh. The UK may not treat the live-in spouses of alleged terrorists as if they, themselves, were on the list, just because they might use their social security benefits to buy groceries for the household. M v. HM Treasury. The BBC story is here and the original House of Lords ruling is here.

The Third Chamber gave a rare ruling interpreting the trade laws established under the Yaoundé and Lomé Conventions in Camar, a case concerning Somalian bananas being imported into Italy. The Somalians lose: the import tax is not unlawful, and Italy is allowed to adjust it for inflation without violating the standstill clause.

In Commission v. Netherlands, the Netherlands was - again - judged to have violated the EEC-Turkey Association Agreement, this time because they maintained discriminatory fees for residence permits.

In Solgar, the Third Chamber discussed Directive 2002/46 on Food Supplements, including the intriguing possibility that a Member State might want to set the maximum amount for certain supplements at zero. (Which is what France had done with fluoride in this case.) The Court concluded that the MS retain the competence to legislate in such matters, as long as they jump through all the hoops established by the Directive (scientific risk assessment, etc.).

General Court judgements:

In the General Court, there was a series of challenges this week to the Commisison's cartel decision C(2005) 3452, regarding the market for industrial threads. (Summary, Press Release). In Amann & Söhne, in Gütermann and in Oxley, the decision was upheld, whereas in BST the fine was reduced from € 979.000 to € 856.600, since the Commission did not accurately take into account BST's cooperation. (They received 20% under the Leniency Notice of 1996, and the Court now increases that discount to 30%.)

Opinions:

In Akzo Nobel, AG Kokott considered the scope of the legal professional privilige in the context of a Competition Law investigation. The Commission had seized certain documents (emails between the general manager of a subsidiary and an Akzo in-house lawyer) which Akzo argued were covered by privilige. The General Court had dismissed that claim as unfounded, and Akzo appealed. Relying on the 1982 case of A M & S, the AG concluded that the GC ruling was correct. He was also unconvinced that the privilige should be extended relative to the current law. Akzo & Akcros v. Commission.

In Rosenbladt, AG Trstenjak discussed whether the "social partners" are allowed to set a mandatory retirement age in a collective bargaining agreement, or whether that would constitute age discrimination contrary to Directive 2000/78. She concludes that it is allowed, as long as there is a sufficient basis in the law, etc., etc. (NL, FR, DE)

This Week in Luxembourg

Two interesting Grand Chamber rulings this week:

In Commission v. Sweden, Sweden gets a slap on the wrist for showing a bit too much initiative internationally. Since the EU and the Member States are both parties to the Stockholm Convention on Persistent Organic Pollutants, they formally all have the right to propose an addition to the list of dangerous substances in Annex A. A Swedish proposal to add perfluaroctane sulfonate to the list went against the Council's stated position. This independent action by Sweden is now found to be in violation of Sweden's duty of sincere cooperation under art. 10 EC (now art. 4(3) EU).

In Federultility, the question concerned the Italian gas market. Under Italian law, there is still some regulation of prices, through the use of "reference prices". The Grand Chamber now ruled that some measure of state intervention is still permissible under Directive 2003/55, and that an intervention such as this one is permissible as long as it pursues a genuine "general economic interest", and does so in a way that is proportionate, as well as "clearly defined, transparent, non discriminatory and verifiable".

Other judgements:

The Fourth Chamber disagreed with AG Jääskinen on the idea of the British NHS offering financial incentives to doctors to get them to prescribe cheaper drugs. The AG was against, arguing that art. 94 of Directive 2001/83 is not, on its face, limited to third parties only. The ECJ now disagreed, referring to the right of the MS under art. 168(7) TFEU to stay in control of their own health care industries. Association of the British Pharmaceutical Industry.

In Dimos Agiou Nikolaou Kritis v. Ipourgos Agrotikis Anaptixis kai Trofimon, there was a bit of a disagreement over the definitions of "forest" and "other wooded land", and particularly the question of whether the definitions given in art. 3 ofRegulation 2152/2003 also applied outside the context of that Regulation. (They don't.)

Opinions:

Most importantly, AG Mazák released his opinion in the appeal in Deutsche Telekom v. Commission. In 2008, the CFI ruled that the competition laws could still be applied to Deutsche Telekom even though its behaviour had been approved (but not required) by the German telecoms regulator. The AG now agrees. Cf. my paper from February for more details.

AG Jääskinen wrote about the Framework Agreement on fixed-term work, which was negotiated by unions and employers' organisations at the European level, and annexed to Directive 1999/70. The interesting bit is the discussion of the second question, concerning the possible remedies in case the national law is found to be wanting (par. 58-71). The AG argues that instruments such as this one will not normally have direct effect, but that national courts are required to interpret the national law to minimise any inconsistency. Sorge v. Poste Italiane

AG Sharpston, finally, has an infringement case against Lithuania concerning the authorisation of medicinal products under - inter alia - the aforementioned Directive 2001/83. She agrees with the Commission that Lithuania should have revoked its pre-accession authorisation of a product called Grasalva, however, she also argues that the Commission should have never brought this case (par 155-163), given that the problem in question arose out of an accession SNAFU without anyone acting in bad faith. To quote her par. 161: Dura lex, sed lex. Commission v. Lithuania.

Destiny

Of course. Exactly on the day that I'm giving a presentation on Deutsche Telekom v. Commission, a case that has been pending before the European Court of Justice for more than 1½ years already, the Attorney-General Mazák will release his opinion. Sometimes it really does look like the Universe is out to get me.

UPDATE: The opinion was published online just at 12.00, when I was supposed to start my presentation. I was just able to print it and see that - as I predicted - the AG proposed dismissing the appeal.

For more ECJ case law, see my newsletter here.

Concours part 1: Application

Don't ask...

This Week in Luxembourg

The big case this week is of course the Grand Chamber ruling in Bressol and Others, on discrimination based on nationality quotas for university admission. In the end, the court concludes that such discrimination is only conceivable in the context of medical training, where the defendant state (in this case the French-speaking Community in Belgium) can rely on the public health justification. It is clear, though, that the national court should be reluctant to find that public health concerns require such a quota system. (Cf. EUObserver)

The Fourth Chamber has followed AG Mengozzi in ruling that, under Directive 97/7 on Distance contracts, a consumer may not be charged for delivery if they invoke their right of withdrawal. Handelsgesellschaft Heinrich Heine. The First Chamber applied a similar consumer protection directive, Directive 85/577 on contracts negotiated away from the business premises, to a closed-end real property fund, much to the benefit of the defendant consumer. Friz.

Predictably, the Hungarian "vocational training levy" which charged the company for all its employees, including workers elsewhere in the EU, did not pass muster in the Third Chamber. CIBA

In Commission v. Germany, AG Trstenjak wrote about a German practice where collective bargaining agreements between unions and government entities locked in only a few financial institutions as providers of certain pension services, without any public tender. She concludes that this fact pattern is capable of falling within the remit of Community law, despite issues of horizontal effect, the fundamental right to collective bargaining, etc., but that the Commission has failed to meet its burden of proof as to the scale neccessary for EU law to apply. Germany wins, but on a technicality. (NL, FR, DE)

AG Bot has an opinion about number portability in telecommunications law: how does a national regulator judge whether the price charged to consumers for this service is proportionate in the meaning of art. 30 of Directive 2002/22? Polska Telefonia Cyfrowa sp. zoo (NL, FR, DE)

This Week in Luxembourg

The most important case this week was clearly the Google AdWords case. AG Maduro had concluded for Google, but the Grand Chamber disagrees on some points. As regards the regular search, it is clear that there is no trademark infringement. But in response to the Adwords questions, the ECJ does seem to favour some form of contributory infringement, something the AG had rejected. Where the ad in question suggests a link between the third party and the trademark holder, or is confusing in this regard, the trademark holder may prohibit the ad. (EUObserver, NRC blog,Businessweek, )

The Google ruling was immediately applied by the First Chamber in the BergSpechte case. As long as the ad makes clear that the product offered does not come from the trademark holder, the defendant is allowed to purchase the plaintiff's trademark as a Google AdWord.

In Commission v. Netherlands, the Commission argued that the provision of personnel by Dutch government entities to the Euregio's should be subject to value added tax. They lost, but not because the argument was as such not viable. Instead, they simply failed to prove that the activity in question took place on a market in the meaning of the 6th VAT directive, etc. (NL, FR)

AG Jääskinen thinks the Commission should lose its appeal against the CFI's ruling in case T-266/02, Deutsche Post v. Commission. If the court agrees, the Commission's state aid decision stays annulled. The difficulty concerned the method used to calculate whether Deutsche Post had simply been compensated for providing a Service of General Economic Interest (cf. the Ferring precedent), or whether it had in fact received illegal state aid. Commission v. Deutsche Post (NL, DE, FR)

Following her opinion in VTB-VAB (ruling here), AG Trstenjak again discusses Directive 2005/29 on unfair b2c commercial practices. A preliminary problem is the question whether the national (Austrian) law falls within the scope of the Directive in the first place, given that it also seeks to protect the pluriformity of the press (i.e. protect competitors as well as consumers). Otherwise, the rule is again that the directive constitutes full harmonisation, meaning that some of the more drastic rules under consideration fall foul of EU law. Mediaprint (NL, DE, FR)

In competition law and procedure, AG Mengozzi handed down an opinion in the Belgian VEBIC case. The question concerned the right - under Regulation 1/2003 - of a national competition authority to intervene in a case where the lawfulness of one of its decisions was under dispute, and possibly its obligation to do so. Referring to last June's X BV case, and his opinion in that case, the AG argues that the NCA should be able to defend its decision, but that there is (ordinarily) no obligation to do so. This answer is independent from the NCA's status as a judicial or administrative body. (NL, DE, FR)

This Week in Luxembourg

The new transfer system in football survived an attack by Olympique Lyonnais before the Grand Chamber this week. The French system, however, was not so lucky. Olympique Lyonnais v. Olivier Bernard. (See also this Dutch blog postabout the case, and the BBC story here.)

According to the Eighth Chamber, a "cinema" where you watch the movie on your own, in a cubicle, starting the movie when you please by inserting a coin is not "admission to a cinema" within the meaning of the 6th VAT Directive, meaning that such a cinema does not qualify for the low VAT rate. Erotic Center v. Belgium. (See also the BBC story on this case.)

Interpreting art. 34 of the Universal Service Directive (Directive 2002/22), as well as the "principle of effective judicial protection", the Fourth Chamber found that an Italian law that made admissibility of a case in the area of electronic communications dependent on whether the parties had first attempted to settle out of court was not fundamentally incompatible with Community Law. The Court did, however, make some substantial demands. Alassini.

While the ruling in X Holding recently upheld a possibly discriminatory element of the Dutch tax laws, today's ruling inGielen goes the other way. The manner in which the "hours worked" of a self-employed person are calculated for the purposes of corporate income tax is judged to be unjustifiably discriminatory.

In Trubowest, the Fourth Chamber upheld the CFI's ruling on appeal. The case concerned a non-contractual liability claim arising out of a cartel and dumping case. The ECJ agreed that the EU courts did not have jurisdiction over some of the claims, while for others the requisite causality was missing. Notably, the ECJ ruled that the CFI was entitled to examine causality before the alleged illegality of the acts in question. (par. 40-50) Citing Lucaccioni, the ECJ ruled that there was no requirement to examine the elements of a 288 claim in any particular order.

In the General Court, the Eighth Chamber ruled in two Belgian state aid cases, Centre de coordination Carrefour andForum 187. In both cases, the action was declared inadmissible for lack of interest in fact.

This Week in Luxembourg

The Grand Chamber ruled in the first polluter pays case under Directive 2004/35, the ERG cases. The rulings largely track the answers proposed by AG Kokott in October, while occasionally adding some nuance, for example that the national court might find applicability ratione temporis of the directive, which the AG had ruled out, or that a somewhat stronger showing of causation is necessary. (Case C-378/08 and joined cases 379/08 and 380/08.)

The Grand Chamber also found against Germany in infringement proceedings based on art. 28(1) of the data protectiondirective 95/46. Contrary to the requirement of the directive, the state (= Land) supervisory agencies were not completely independent from the state. Commission v. Germany.

The Third Chamber found a (relatively) new Italian rule setting a minimum distance between petrol stations an infringement of the freedom of establishment (art. 49 TFEU). From a procedure point of view, note the potential mootness problem caused by the fact that the relevant law is no longer in force (par. 26-31). Attanasio Group Srl v Comune di Carbognano.

In Wood Floor Solutions, the Third Chamber gave guidance regarding art. 5(1) of the Brussels I Regulation. The Court found no difference between its existing case law regarding contracts to be performed in a number of different places within a single MS, and the case at bar where performance was in a number of different MS. The result is not very helpful, given the objective of predictability, since it means the defendant can be sued at "the place of the main provision of services", wherever that is. (cf. par. 40 and 41).

The Third Chamber also ruled in a telecommunications case, where the Polish authorities wanted to go after Telekomunikacja Polska for allegdly illegal bundling. The ECJ ruled that the Polish approach was consistent with the relevant telecom directive, Directive 2002/20, but that it fell foul of a directive that the referring judge had not mentioned,Directive 2005/29 on unfair b2c commercial practices. Under the latter directive, Poland is not allowed to impose a blanket ban on combined offers. Telekomunikacja Polska v. Prezes Urzędu Komunikacji Elektronicznej.

The Fourth Chamber considered the problem of a national court asked to order the recovery of state aid when the Commission Decision that declared the aid to be compatible with the Common Market (even though it had not been notified), had been annulled by the Community Courts, but the Commission had not yet taken a new Decision. In those circumstances, the ECJ ruled, the national court has to proceed with the recovery, instead of waiting for the Commission (and the Community Courts) to make up their minds. CELF v. SIDE

AG Mengozzi wrote a rare opinion about the protection of biotech patents under Directive 98/44. Monsanto tried to use its European patent to block the importation of soy meal from Argentina, where its invention was not defended by any intellectual property right. The AG proposes that the patent only extends to the time when the gene sequence "functions" as described in the patent, meaning that Monsanto should lose. He also argues that the directive aims at full harmonisation. Monsanto v. Cefetra (Dutch, German, French)

AG Jääskinen wrote about Italian pharmacy regulation, arguing that Italy is free under EU law to restrict their opening hours. Sbarigia v. Azienda USL RM/A. (Dutch, German, French)