European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

Under Article 37 TFEU, Member States are subject to a twofold obligation: the active obligation to adjust their monopolies so that no discrimination exists between nationals of Member States regarding the conditions under which goods are procured and marketed (Art. 37(1)); the passive obligation to refrain from introducing any new measure which is contrary to the principles of adjustment or which  …

Adjustment and prohibition of discriminatory measures

Under Article 37 TFEU, Member States are subject to a twofold obligation: the active obligation to adjust their monopolies so that no discrimination exists between nationals of Member States regarding the conditions under which goods are procured and marketed (Art. 37(1)); the passive obligation to refrain from introducing any new measure which is contrary to the principles of adjustment or which would restrict the scope of the Articles dealing with the elimination of customs duties and quantitative restrictions between Member States (Art. 37(2)). Article 37 does not prohibit the creation of all State monopolies but merely those of a commercial character which tend to introduce new discrimination between nationals of Member States regarding the conditions under which goods are procured and marketed .

Monopolies of a commercial character must be adjusted so as to eliminate the exclusive right to import from other Member States , or where they pursue a public interest aim, not to create obstacle to the free movement of goods . The criteria and methods of selection must not be discriminatory or likely to put imported products at a disadvantage, and the marketing and advertising measures for the monopoly must be impartial and independent of the origin of the products and endeavor to make known new products to consumers . The selection system of a sales monopoly must provide both for an obligation to state reasons for decisions and for an independent monitoring procedure . 

Article 37 remains applicable wherever, after the prescribed adjustment, the exercise by a State monopoly of its exclusive rights entails a discrimination or restriction prohibited by that Article .

In effect, Article 37(2) TFEU prohibits any new measure which establishes or aggravates a discrimination between nationals of Member States regarding the conditions under which goods are procured and marketed, or which restricts the scope of the articles dealing with the prohibition of customs duties and quantitative restrictions between Member States. The provision does not prohibit the extension to imported products of a charge previously imposed only on similar domestic products subject to a monopoly , or the same taxation on an imported product and a similar domestic product with a different allocation of the charge , or the fixing on a domestic market of uniform trading margins for the retail sale of tobacco where no similar obligation is imposed on foreign markets .

By contrast, the marketing of a product by a State monopoly with the aid of public funds at an abnormally low resale price compared to the price of the product imported from another Member State , the fixing of the price of manufactured tobacco, including for imported products, where domestic products fall within a national monopoly , the exclusive right to import and market finished petroleum products, which deprives distribution companies of the possibility of procuring from undertakings established in other Member State up to a given percentage of the requirements of the domestic market corresponding to the unadjusted part of the monopoly  or exclusive export rights which affect only the conditions under which goods are procured by operators or consumers in other Member States  entail a discrimination prohibited by Article 37. 

Case 6/64 Costa v E.N.E.L. [1964] ECR 1141, LawLex200400002821JBJ.

See, for exclusive right to import: Case 59/75 Manghera and others [1976] ECR 91, LawLex200900001976JBJ; Case C-347/88 Commission v Greece [1990] ECR I-4747, LawLex200900000434JBJ; exclusive right to export: Case C-158/94 Commission v Italy [1997] ECR I-5789, LawLex200900000624JBJ.

Case 90/82 Commission v France [1983] ECR 2011, LawLex200900002189JBJ.

Case C-347/88 Commission v Greece [1990] ECR I-4747, LawLex200900000434JBJ.

Case C-158/94 Commission v Italy [1997] ECR I-5789, LawLex200900000624JBJ.

Case C-189/95 Criminal proceedings against Franzén [1997] ECR I-5909, LawLex200900000764JBJ.

Case C-438/02 Hanner [2005] ECR I-4551, LawLex200900000811JBJ, for the activity of retail sale of medicinal preparations.

Case 91/78 Hansen [1979] ECR 935, LawLex200900002017JBJ.

Case 13/70 Cinzano & CIA GmbH v Hauptzollamt Saarbrücken [1970] ECR 1089, LawLex200900001524JBJ.

Case 45/75 Rewe-Zentrale v Hauptzollamt Landau-Pfalz [1976] ECR 181, LawLex200900001978JBJ, where a part of the charge imposed on the domestic product is allocated for the purposes of financing a State monopoly, whilst the charge levied on the imported product is imposed for the benefit of the general budget of the State.

Case 78/82 Commission v Italy [1983] ECR 1955, LawLex200900002185JBJ.

European Business Law

71. Adjustment and prohibition of discriminatory measures

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71. Adjustment and prohibition of discriminatory measures

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise