PROBLEM 1
Learning objectives:
1. Are charges that are levied on foreign products at the borders permitted under European law? What are
the derogations?
2. Are national charges that penalize mainly foreign products permitted under European law? What are the
derogations?
3. Solve the problem: is the French tax permitted? Is the Italian tax permitted? → niet uitgewerkt
Literature:
- E-lesson on Free Movement of Goods Part I: Fiscal Barriers (Articles 30 and 110 TFEU)
- E-lesson on the Pre-Test
- E-lesson on the General principles applicable to the free movements
- Webcast on Basic Notions Part 1
- Webcast on Basic Notions Part 2
- Webcast on Fiscal Barriers
Case Law:
Art Treasures-case (Commission vs. Italy, C-7/68) (Only Beer & Wine-case (Commission vs. United Kingdom,
rule) 170/78)
Statistical Levy-case (Commission vs. Italy, C-24/68 Dried Bananas-case (Commission vs. Italy, 184/85)
Bauhuis v. The Netherlands-case (46/76) Natural Sweet Wines-case (C-196/85)
Dark Tobacco-case (Commission vs. France, 302/00) Outokumpu-case (C-213/96)
1. ARE CHARGES THAT ARE LEVIED ON FOREIGN PRODUCTS AT THE BORDERS
PERMITTED UNDER EUROPEAN LAW? WHAT ARE THE DEROGATIONS?
Prohibition of discrimination, cross-border element, purely internal situation, reverse discrimination
Prohibition of discrimination
The prohibition of discrimination entails that EU citizens are not allowed to be discriminated against on
grounds of nationality (Article 18 TFEU). This entails that Member States cannot treat other EU nationals
worse compared to their own nationals.
9 Applies to all sectors
There are three forms of discrimination: direct, indirect and non-discrimination.
• Direct discrimination entails a direct link between the measures of a Member State and the
nationality of a citizen or the origin of a good. Sometimes 'direct discrimination' is known as
'measures applying with distinction'.
• Indirect discrimination entails discrimination that does not distinguish according to the origin of
the product, yet is based on qualities that usually have a disproportionate effect on foreigners,
for example, a language requirement, residence requirement etc. These requirements are
usually easier to fulfill by people from the Member State that enacts the measure, in
comparison to foreigners. Sometimes 'indirect discrimination' is known as 'measures applying
without distinction'.
• A non-discriminatory restriction entails a measure that does not make a distinction, i.e. does not
treat two comparable situations differently. Neither directly in its wording nor indirectly by
affecting one situation less favorably than the other.
o An example is asking for different requirements, such as the prohibition to sell products
on a Sunday.
1
, Cross-border element
The four freedoms are arranged in EU law. For these rights to be applicable, there needs to be a
European dimension or a cross-border element.
• This is the case when an EU Member State’s measure has an effect on the free movement
between Member States.
• This can, for instance, entail that the goods/persons/services or capital cross the border from
one Member State to another.
Purely internal situation
If there is only a purely internal situation in a Member State (no crossing to another Member State or no
effect on the free movement goods/persons/services or capital between Member States), the parties
cannot appeal to the European rights of the four freedoms.
• In a purely internal situation, in principle, the national law of the Member State is applicable.
Reverse discrimination
Reverse discrimination entails that discrimination is applied to the citizens of a Member State and not to
the foreigners entering that Member State; this is also known as a U-turn construction.
• Own citizens are disproportionately affected by the rule in comparison to the citizens of another
Member State.
• Reverse discrimination is not forbidden because the application of EU law requires a cross-
border element to be present. The prohibition of discrimination, Article 18 TFEU, is thus not
applicable.
• This problem is only applicable within the Member States themselves and will need to be solved
within national law of those Member States.
Exceptions, justifications, objective differentiations and proportionality → see ‘Basic Notions II’
Dual burden & mutual recognition
Dual burden
• With the prohibition of discrimination, dual burdens are prohibited.
• A dual burden is a burden on an individual not only stemming from the home Member State
but also from the host Member State.
• Example: a person selling goods in one Member State according to the measures of that
Member State, but also having to adopt measures of another Member State it is exporting
goods to.
• If the measure of one Member State is not according to the EU law and causes a burden on the
national of another Member State, this is called a dual burden
Mutual recognition
• Mutual recognition entails that products that comply with the rules of a Member State (= are
legally marketed) must also be allowed to be legally marketed in another Member State;
• Member States should respect and recognize each other’s rules.
The 4-step Test
The 4-step test is designed to help you decide whether a measure in question can be classified as a
breach of EU law.
1) Scope? The scope of this test entails the questions to whom the provision or freedom is
applicable to and what the rights under this topic are:
o Personal scope (Who benefits from the rights)?
o Material scope (What are the rights one can benefit from)?
2) Barrier/ Hindrance? What kind of barrier/ hindrance is applied? It can be a direct, indirect or
non- discriminatory measure.
2
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