Commission v Italy (Free movement of goods) [2003] EUECJ C-420/01 (19 June 2003)

Judgment By application lodged at the Court Registry on 23 October 2001, the Commission of the European Communities brought an action under Article 226 EC for a declaration that, by applying to drinks produced and marketed in other Member States a rule prohibiting the marketing in Italy of energy drinks containing caffeine in excess of a certain limit, without showing that that limit is necessary and proportionate for the protection of public health, the Italian Republic has failed to fulfil its obligations under Articles 28 EC and 30 EC. Legal background Community law There are no provisions of Community law which lay down the conditions governing the addition of nutrients, such as caffeine, to foodstuffs for general consumption. National law Article 15(3) of Presidential Decree No 719 of 19 May 1958, entitled Regulation laying down the general health provisions relating to the production and marketing of sparkling water, and sparkling or still non-alcoholic drinks produced in sealed containers, ( GURI No 178 of 24 July 1958, p. 3081; PD No 719/58) provides: The addition of substances other than those listed in this regulation, which have not received prior approval by the High Commissioner for Hygiene and Public Health, must, at the request of the health authority of the district in which the factory is established and following an opinion from the district health council, be authorised in each case by the High Commissioner on an individual basis. Pre-litigation procedure The Commission was alerted by complaints from economic operators to the existence of barriers to the import into and marketing in Italy of certain energy drinks lawfully produced and marketed in other Member States. Those drinks, which include the Red Bull, CULT and GUVI brands, are characterised by the fact that they contain caffeine in quantities ranging from 250 mg/l to 320 mg/l, and often contain other substances such as taurine. The Italian authorities initially prohibited the marketing of such drinks, in particular those containing taurine, under Legislative Decree No 111, of 27 January 1992 ( GURI No 39, of 17 February 1992, Ordinary Supplement), and in accordance with an opinion of 13 December 1995 of the Consiglio Superiore della Sanità (the Italian Board of Health; the CSS). The Italian authorities subsequently altered their position and authorised the marketing of such drinks in Italy subject, however, to the condition that their caffeine content does not exceed 125 mg/l. On 4 October 1996, taking the view that, in the absence of scientific data demonstrating that where that limit is exceeded there is a risk to public health, such a prohibition constitutes a measure having equivalent effect to a quantitative restriction on imports, which is contrary to Article 28 EC and not justified by Article 30 EC, the Commission sent a letter of formal notice to the Italian Government. Since it was not satisfied with the response sent to it by the Italian authorities on 8 January 1997, the Commission issued a reasoned opinion on 23 September 1997, in which it called upon the Italian Republic to comply with its obligations under Article 28 EC within two months of notification of that opinion. After having informed the Commission that the CSS, to which the matter had once again been referred, had found that, according to current levels of knowledge, the drinks in question raised no public health concerns, the Italian authorities notified the Commission on 18 June 1998 of Circular No 5 of the Minister for Health, of 3 April 1998, entitled Drinks of Community origin characterised by high levels of caffeine and taurine ( GURI No 101, of 4 May 1998, p. 72; the 1998 Circular), which authorises the marketing in Italy of such drinks where they are lawfully produced and marketed in other Member States. The economic operators which lodged complaints with the Commission affirmed that, in practice, the free movement in Italy of drinks originating in other Member States, where they were lawfully produced and/or marketed, was ensured as a result of the 1998 Circular. After the Commission had reminded the Italian authorities on several occasions that they nevertheless remained obliged to amend, definitively and in accordance with the customary procedures, the contested provisions of Italian law, and that they were required to do so as swiftly as possible, the Italian authorities finally notified the Commission on 13 November 2000 of a draft regulation to up-date the legislation on the production and sale of non-alcoholic drinks in general, including those containing caffeine, which contained a mutual recognition clause excluding from its scope non-alcoholic drinks lawfully produced and marketed in the other Member States of the European Union and in the Member States of the European Economic Area. In reply to the Italian authorities, the Commission stated that certain amendments needed to be made to the mutual recognition clause in order to eliminate all ambiguity. Not having received any response from the Italian authorities, the Commission asked them, by letter of 9 April 2001, whether they had received its observations on the draft regulation notified to it and when the Italian Government intended to adopt the amending regulation. Since it did not receive any response, the Commission took the view that the initial version of PD No 719/58 remained in force and that no amendment had yet been made to bring the Italian legislation into line with the Community rules as regards the recognition of non-alcoholic drinks produced and marketed in other Member States. It therefore decided to bring the present action. The action Arguments of the parties The Commission asserts that, while it is not possible to clearly identify the legal basis for the prohibition on importing into and marketing in Italy non-alcoholic drinks with a caffeine content in excess of 125 mg/l, it is indisputable that such a prohibition exists. According to the Commission, this is confirmed by the complaints addressed to it by a number of Community producers of non-alcoholic energy drinks, by the very wording of Article 15(3) of PD No 719/58, and by the fact that the Italian authorities have themselves recognised the need, if not the obligation, to amend or repeal certain provisions of Italian law currently in force in the non-alcoholic drinks sector, as evidenced by the adoption of the 1998 Circular and by the draft regulation notified to the Commission. Given the case-law of the Court in relation to Articles 28 EC and 30 EC, the Commission considers that the fact that there has been a failure to fulfil obligations appears to be beyond dispute. First of all, the Italian authorities cannot assert on the one hand that drinks with a high caffeine content may pose a health risk and, on the other, authorise the distribution of such drinks, as they did by way of the 1998 Circular. Next, it is not clear to the Commission on what scientific evidence the Italian authorities base the grounds of protection of health on which they rely as justification for the contested prohibition, given the fact that, in its later opinion, the CSS took the view that drinks with a high caffeine content pose no health risks. Finally, a mere obligation for the producer of the drinks in question to provide the consumer with accurate information as to their caffeine content is an effective way to protect persons at risk. The Commission considers that the dispute in fact concerns the measures adopted by the Italian Republic with a view to bringing its legislation in line with the Community rules, after the legislation had been found to be incompatible with those rules. According to the Commission, under the legislative framework currently in force in Italy, and contrary to the case-law of the court, interested parties are not informed of the full extent of their rights or permitted to enforce them, where necessary, before the national courts. The 1998 Circular is not capable of amending the contested provisions. The Italian Government considers that an upper limit for caffeine is justified, in particular, by the evaluations undertaken by the Italian health authorities. The whole matter must be resolved from the point of view of the lawfulness of the scientific position adopted by the those authorities. Any other solution would, in its view, deprive Article 30 EC of its content by replacing the non-arbitrary discretion of the Member State with the subjective opinion of the health authorities of another Member State, which although legitimate is certainly not such as to be inherently indisputable. The Italian Government submits that it is for the Commission to produce scientific evidence that, given the prevailing environmental conditions in Italy, the fixing of a maximum authorised caffeine level does not satisfy the criteria of a proper balancing of the interests in question. It states, however, that a legislative text has been drawn up with a view to amending the disputed provisions in question. Moreover, the 1998 Circular permitted the marketing in Italy of products with a caffeine content higher than that which had been authorised by the provisions applicable in that sector. Findings of the Court The free movement of goods between Member States is a fundamental principle of the Treaty, expressed in the prohibition, laid down in Article 28 EC, of quantitative restrictions on imports between Member States and of all measures having equivalent effect. The prohibition on measures having equivalent effect to quantitative restrictions laid down in Article 28 EC covers all trading rules in Member States which are capable of hindering directly or indirectly, actually or potentially, intra-Community trade (Case 8/74 Dassonville [1974] ECR 837 , paragraph 5, and Case 178/84 Commission v Germany ( Beer Purity ) [1987] ECR 1227 , paragraph 27). According to settled case-law, in an action under Article 226 EC, the question whether a Member State has failed to fulfil its obligations must be determined by reference to the situation prevailing at the end of the period laid down in the reasoned opinion (see Case C-476/98 Commission v Germany [2002] ECR I-0000, paragraph 42). In the present case, it is clear from the case-file that at the time of the expiry of the two-month period laid down in the reasoned opinion, there was a prohibition in Italy on the marketing of energy drinks, lawfully produced and marketed in other Member States, whose caffeine content was in excess of a certain limit. Even though, despite the replies given by the Italian Government and the Commission to the written question from the Court on the matter, there are still uncertainties as to the legal basis of that prohibition in Italian law, the Italian Government has never denied that there was such a prohibition in force on the date referred to above, and even expressly acknowledged its existence in its reply of 8 January 1997 to the letter of formal notice. It is common ground that a prohibition on the marketing of energy drinks containing caffeine in excess of a certain limit, which are lawfully produced and marketed in other Member States, whether it derives from regulatory provisions or an administrative practice, impedes intra-Community trade, and thereby constitutes in principle a measure having an equivalent effect to a quantitative restriction within the meaning of Article 28 EC (see, to that effect, Case C-42/90 Bellon [1990] ECR I-4863 , paragraph 10). Such a prohibition can only be justified if it is necessary on one of the grounds of public interest set out in Article 30 EC, such as the protection of health and life of humans, or in order to meet imperative requirements relating, inter alia , to consumer protection. According to settled case-law, it is for the competent national authorities to show, in each case, that their rules or administrative practices are necessary to effectively protect the interests envisaged by Article 30 EC or to meet imperative requirements and, where appropriate, that the marketing of the products in question poses a risk to public health (see, to that effect, Case 304/84 Muller and Others [1986] ECR 1511, paragraph 25, Beer Purity , cited above, paragraph 46, and Joined Cases C-13/91 and C-113/91 Debus [1992] ECR I-3617 , paragraph 18). In the present case, the Italian Government has not shown that the prohibition on the marketing of energy drinks containing caffeine in excess of a certain limit is necessary and proportionate for the protection of public health. The CSS opinion of 13 December 1995 initially relied on by the Italian authorities to justify the prohibition on the marketing of such drinks is no longer valid, since the CSS later found that, according to current levels of knowledge, those drinks raised no public health concerns. In any event the Italian authorities could not have concluded from the CSS opinion that the disputed marketing prohibition was proportionate to the object of effective protection of the health of the Italian population, given the fact that that opinion concerned drinks with a caffeine content as high as 320 mg/l, that is, more than double the limit of 125 mg/l imposed by the prohibition in question. As regards the 1998 Circular which, according to the Italian authorities, authorised the release for consumption of the energy drinks in question and thus put an end to the failure to fulfil obligations that gave rise to this action, it should be recalled that the question whether a Member State has failed to fulfil its obligations must be determined by reference to the situation prevailing in the Member State at the end of the period laid down in the reasoned opinion, and that the Court cannot take account of any subsequent changes (see Case C-476/98 Commission v Germany , cited above, paragraph 42, and Case C-122/02 Commission v Belgium [2003] ECR I-0000, paragraph 11). Since the 1998 Circular was adopted after expiry of the period laid down in the reasoned opinion, the Commission's application must be upheld and there is no need to examine the question whether the adoption of that circular constitutes valid performance by the Italian Republic of its obligations under Community law. In the light of the foregoing considerations, it must be held that, by applying to drinks produced and marketed in other Member States a rule prohibiting the marketing in Italy of energy drinks containing caffeine in excess of a certain limit, without showing that that limit is necessary and proportionate for the protection of public health, the Italian Republic has failed to fulfil its obligations under Articles 28 EC and 30 EC. Costs 37. Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party's pleadings. Since the Commission has applied for costs and the Italian Republic has been unsuccessful in its defence, the latter must be ordered to pay the costs. On those grounds, THE COURT (Third Chamber) hereby: 1. Declares that, by applying to drinks produced and marketed in other Member States a rule prohibiting the marketing in Italy of energy drinks containing caffeine in excess of a certain limit, without showing that that limit is necessary and proportionate for the protection of public health, the Italian Republic has failed to fulfil its obligations under Articles 28 EC and 30 EC; 2. Orders the Italian Republic to pay the costs. Puissochet Macken Cunha Rodrigues Delivered in open court in Luxembourg on 19 June 2003. R. Grass J.-P. Puissochet Registrar President of the Third Chamber 1: Language of the case: Italian. BAILII: Copyright Policy | Disclaimers | Privacy Policy | Feedback | Donate to BAILII