CJEC, March 13, 1984, No 16-83

The Court

1 By an order dated 12 January 1983, which was received at the Court of 28 January 1983, the Landgericht Munchen (regional Court, Munich) II referred to the Court for a preliminary ruling under Article 177 of the EEC Treaty two questions on the interpretation of Articles 30 and 36 of the EEC Treaty to enable it to decide whether paragraph 17 of the Verordnung uber Wein, Likorwein und Weinhaltige getranke (Regulation on wine, liqueur-wine and wine-based beverages) of 15 July 1971 (Bundesgesetzblatt 1971, Part I, p. 926) - hereinafter referred to as "the Wein-verordnung" - is compatible with Community law.

2 Those questions were raised in criminal proceedings brought against an italian national, Karl Prantl, a dealer in beverages, who was charged with making improper use of "Bocksbeutel" bottles by persistently importing into the Federal Republic of Germany and selling and holding in stock for sale there between 3 December 1980 and 10 September 1981 Italian red wine originating from the Martini cellars in Girlan (province of Bolzano - Trentino alto adige).

3 The Bocksbeutel bottle has a characteristic bulbous shape and quality wine PSR produced in Franconia, Baden-Franconia and four municipalities located in central Baden is marketed in Bocksbeutel bottles. In Franconia Bocksbeutel bottles have been used for several centuries.

4 In italy, in the province of Bolzano, the use of the Bocksbeutel bottle has a tradition going back more than one hundred years. The traditional Italian Bocksbeutel bottle is somewhat rounder and has a shorter neck than the Franconian Bocksbeutel bottle.

5 In the version applicable to the facts which are the subject of the main proceedings, paragraph 17 of the Wein-verordnung provides as follows:

"Only quality wine PSR from the specific growing area of Franconia, the Taubertal in Baden, the Schupfergrund and the municipalities of Neuweier, Steinbach, Umweg and Varnhalt may be marketed in Bocksbeutel bottles of the traditional kind."

The second subparagraph of paragraph 23 provides that:

"Pursuant to paragraph 67(5), point 2, of the Weingesetz (wine law) any person who contrary to paragraph 17 hereof markets in Bocksbeutel bottles products other than those enumerated in that provision shall be guilty of an offence."

6 On 6 July 1982 the Amtsgericht (local Court) miesbach acquitted Mr Prantl. It was of the opinion that, although the bottles used by Mr Prantl were traditional Bocksbeutel bottles within the meaning of paragraph 17 of the Wein-verordnung, that provision was not applicable by virtue of Articles 30 and 36 of the EEC Treaty.

7 The public prosecutor appealed against that decision to the Landgericht Munchen II arguing, on the one hand, that paragraph 17 of the Wein-verordnung did not constitute a quantitative restriction on imports contrary to Article 30 of the Treaty and, on the other hand, that the provision was justified in the interests of consumer protection and fair trading.

8 The Landgericht considers that owing to their shape the Bocksbeutel bottles used by Mr Prantl's company "looked very much like Franconian Bocksbeutel bottles" and is inclined to think that they are traditional Bocksbeutel bottles within the meaning of paragraph 17 of the Wein-verordnung. However, it wonders whether in the case of imports of wine from another Member State paragraph 17 is compatible with Articles 30 and 36 of the Treaty.

9 The Landgericht Munchen II therefore decided that before it delivered judgment in the criminal proceedings it must obtain from the Court of Justice a preliminary ruling on the following questions:

"1. Does paragraph 17 of the Wein-verordnung of 15 July 1971 have an effect equivalent to a quantitative restriction on imports prohibited by Article 30 of the EEC Treaty?

2. In the particular circumstances of the present case, can paragraph 17 of the Wein-verordnung be applied in order to protect the interests mentioned in Article 36 of the EEC Treaty?"

10 As the government of the Federal Republic of Germany has correctly pointed out, the Court cannot, in the context of Article 177 of the EEC Treaty, give a ruling on the interpretation and validity of provisions of national laws or regulations. However, the Court may, as it has held on many occasions, provide the national Court with the criteria for the interpretation of Community law which will enable it to decide for itself the issue before it.

11 Understood in that sense the questions submitted ask in effect whether Articles 30 and 36 of the Treaty must be interpreted as prohibiting provisions of the kind enacted in the national legislation in question.

The application of the Community rules on the common organization of the market in wine

12 It is first necessary to consider the main submission of the Commission to the effect that in the common organization of the market in wine there are exhaustive Community rules containing all the necessary provisions regarding the presentation of wines and use of certain containers for the purpose of distinguishing between wines according to their quality and origin. The Commission accordingly concludes that there are now over-riding provisions of Community law and that since the entry into force of the aforesaid rules the Member States may no longer maintain in force or enact measures of domestic law in this field.

13 It is true that, once rules on the common organization of the market may be regarded as forming a complete system, the Member States no longer have competence in that field unless Community law expressly provides otherwise.

14 It is also true that at the time of the events which the national Court must consider, the provisions of Community law on the common organization of the market in wine (in particular Council Regulation No 337-79 of 5 February 1979 on the common organization of the market in wine - Official Journal L 54, p. 1; Council Regulation No 355-79 of 5 February 1979 laying down general rules for the description and presentation of wines and grape musts - Official Journal L 54, p. 99; Commission Regulation No 2164-80 of 8 August 1980 amending for the seventh time regulation No 1608-76 laying down detailed rules for the description of wines and grape musts - Official Journal L 214, p. 1 and Commission Regulation No 997-81 laying down detailed rules for the description and presentation of wines and grape musts - Official Journal L 106, p. 1) could be regarded as forming a complete system, especially as regards prices and intervention, trade with non-member countries, rules on production and oenological practices and as regards requirements relating to the designation of wines and labelling.

15 However, it must be observed that Article 54(1) of Regulation No 337-79 expressly provides that: "the Council, acting by a qualified majority on a proposal from the Commission, shall adopt, as necessary, the rules relating to the designation and presentation of the products listed in Article 1. Until entry into force of the rules referred to in the first subparagraph, the rules on this matter shall be those adopted by the Member States". Regulation No 355-79 merely provides that use of the containers may be subject to certain conditions to be laid down for the purpose of ensuring in particular that the quality and origin of the products may be distinguished (Article 40) and that the designation and presentation of wines must not be liable to cause confusion as to the nature, origin and composition of the product (Article 43). On the question of the protection to be given to certain shapes of bottle Article 18 of Regulation No 997-81 merely protects the use of the bottle known as the "flute d'Alsace".

16 As regards the question of bottle shapes and the protection which they may possibly enjoy, which is of secondary importance in relation to the fundamental principles of a common organization of the market, it is not possible to deduce from the provisions regarding the protection of the "flute d'Alsace" that the Community legislation has exhausted its competence under Article 54, mentioned above. In this regard it may also be noted that negotiations have been conducted at the Community level for several years with the aim of introducing rules for potecting the Bocksbeutel bottle and that to that end several draft regulations have been prepared but without success. It thus appears that the Community legislature protecting the "flute d'alsace" is not exclusive. Therefore Article 54(1) of Regulation No 337-79 allows the rules adopted by the Member States to be maintained in this field provided that they do not contravene Article 30 et seq. of the EEC Treaty.

17 In those circumstances the Commission's main argument must be rejected and the questions of the national Court on the interpretation of Articles 30 and 36 of the Treaty must therefore be answered.

Article 30 of the EEC Treaty (first question)

18 By this question the national Court asks in substance whether Article 30 of the EEC Treaty must be interpreted as meaning that the application by a Member State to imports of wine originating in another Member State of legislation allowing a specific shape of bottle to be used only by certain national producers and making it an offence for any other supplier to use a similar bottle constitutes a measure having an effect equivalent to a quantitative restriction.

19 The government of the Federal Republic of Germany has argued that the contested provision of the Wein-verordnung does not come within the scope of Article 30 of the EEC Treaty as it:

- does not constitute a national measure capable of having an appreciable effect on intra-Community trade;

- applies to national and imported products alike;

- makes only the use of traditional Bocksbeutel bottles an offence and normally does not therefore affect importers using similar bottles if these are only slightly different from the traditional bottles; and

- is justified on the grounds of consumer protection and fair trading, as the traditional Bocksbeutel must be regarded as an indirect designation of geographical origin.

20 It must be borne in mind in the first place that Article 30 of the EEC Treaty prohibits all measures having an effect equivalent to a quantitative restriction in trade between Member States. For there to be a breach of that prohibition it is sufficient that the measures in question are liable to impede, directly or indirectly, actually or potentially, trade between the Member States. It is not necessary that they should have an appreciable effect on intra-Community trade.

21 Secondly, it should be pointed out that, as the Court has already held on many occasions, even national legislation on the marketing of a product which applies to national and imported products alike falls under the prohibition laid down in Article 30 of the EEC Treaty if in practice it produces protective effects by favouring typical national products and, by the same token, operating to the detriment of certain types of products from other Member States.

22 A provision such as paragraph 17 of the Wein-verordnung, allowing a specific shape of bottle to be used only by certain producers of domestic wine, has protective effects inasmuch as it favours those producers compared to producers in other Member States who traditionally bottle their wine in bottles of identical or very similar shape.

23 If producers in the exporting Member State wish to market their wine in the Member State in which the legislation at issue in the main proceedings was enacted, they must bottle their wine destined for that specific market in bottles different from those which they traditionally use in the country of origin as well as on the markets of the other Member States. The marketing of that wine would thus be made more difficult or costly owing in particular to the additional costs entailed by the need to bottle those products in a specific way in order to make them comply with the requirements of the market for which they were intended. Moreover, those producers would be deprived of the commercial advantages which they may derive from using on the market in which the legislation in question applies the bottle traditionally used in the country or region of origin.

24 It thus appears that, although such legislation applies to national and imported products alike, in practice it has protective effects. It therefore comes within the scope of the prohibition laid down by Article 30 of the EEC Treaty.

25 Thirdly, it is true, as the Court has held many times, that in the absence of comprehensive Community legislation on the bottling of the products in question, obstacles to free trade within the Community owing to disparities between national rules must be accepted in so far as such rules, applicable to domestic and imported products alike, may be justified on the ground that it is necessary to satisfy mandatory requirement relating in particular to consumer protection and fair trading.

26 In principle, the justification for adopting legislation designed to prevent customers from confusing wines of different quality and origin cannot be denied. That concern is particularly worthy in the case of wines, for traditions and pecularities play an important role in this field. Moreover, the second recital in the preamble to Regulation No 355-79 states in this regard that:"... The purpose of any description and presentation should be to supply potential buyers and public bodies responsible for organizing and supervising the marketing of the products concerned with information which is sufficiently clear and accurate to enable them to form an opinion of the products;... Rules should therefore be drawn up to ensure that this purpose is served "the third recital in the preamble to the Regulation than states that:"... Steps should be taken to ensure that the information provided is as complete as possible and that it takes account of the different customs and traditional practices in the Member States and in third countries and complies with Community law."

27 Where, however, it is a matter of determining whether the legislation of a Member State may, in order to protect an indirect designation of geographical origin in the interests of consumers, prohibit the marketing of wines imported in a certain type of bottle, it must be observed that in the system of the common market consumer protection and fair trading as regards the presentation of wines must be guaranteed with regard on all sides for the fair and traditional practices observed in the various Member States.

28 In this regard the arguments advanced before the Court have revealed that bottles which are identical in shape to the Bocksbeutel bottle or differ from it only in ways imperceptible to the consumer are traditionally used to market wines originating in certain regions of Italy. An exclusive right to use a certain type of bottle granted by national legislation in a Member State may not therefore be used as a bar to imports of wines originating in another Member State put up in bottles of the same or similar shape in accordance with a fair and traditional practice observed in that Member State.

29 The government of the Federal Republic of Germany maintains that consumers might be misled if wines from different regions were marketed in the same type of bottle. In answer to that point it must be observed, however, that the provisions of Community law on the labelling of wines, particularly Articles 12 to 18 of Regulation No 355-79 concerning the labelling of quality wines PSR, are particularly comprehensive and enable the feared confusion to be avoided.

30 The answer to the first question must therefore be that Article 30 of the EEC Treaty must be interpreted as meaning that the application by a Member State to imports of wine originating in another Member State of national legislation allowing only certain national producers to use a specific shape of bottle when the use of that shape or a similar shape of bottle accords with a fair and traditional practice in the state of origin constitutes a measure having an effect equivalent to a quantitative restriction.

Article 36 of the EEC Treaty (second question)

31 This question of the national Court is in substance whether one of the exceptions laid down in Article 36 of the EEC Treaty to the fundamental principle of the free movement of goods may justify the application of a provision allowing only one group of national producers to use a specific shape of bottle.

32 In this connection the government of the Federal Republic of Germany has submitted first of all that paragraph 17 of the Wein-verordnung is justified on grounds of public policy within the meaning of Article 36 of the EEC Treaty since it carries penal sanctions.

33 In answer to that point it must be stated that legislation does not come within the ambit of the concept of public policy within the meaning of Article 36 of the Treaty merely because it carries penal sanctions.

34 The government of the Federal Republic of Germany has secondly argued that the presentation of Franconian wine and Baden wine in the "traditional Bocksbeutel bottle" is an indirect indication of geographical origin and therefore constitutes an industrial or commercial property right which belongs to the wine producers in the specific region and which the rules at issue may legitimately protect.

35 In this regard it need merely be observed, without its being necessary to resolve the questions of law raised by that argument, that producers who traditionally use a bottle of a specific shape may not in any event successfully rely upon an industrial or commercial property right in order to prevent imports of wines originating in another Member State which have been bottled in identical or similar bottles in accordance with a fair and traditional practice in that state.

36 Lastly, the government of the Federal Republic of Germany has pointed out that on 4 June 1978 a German association called "Frankenwein - Frankenland EV", whose object is inter alia to protect the right of exclusive use of the Bocksbeutel for bottling Franconian wine, registered a collective mark consisting of a picture of a traditional Bocksbeutel bottle bearing an illustrated label. It concludes from that fact that the association is the owner of an industrial or commercial property right and that the value of the registered mark would be impaired if it were permissible to use the "traditional Bocksbeutel" for wines from other regions.

37 The fact that an association of producers has registered a mark depicting a specific shape of bottle bearing an illustrated label and the protection which such registration provides are, however, irrelevant as regards the question whether national legislation allowing only wine producers in certain regions to use a bottle of the same shape is justified under Article 36 of the EEC Treaty.

38 The answer to the second question of the national Court must therefore be that Article 36 of the EEC Treaty must be interpreted as meaning that measures having an effect equivalent to quantitative restrictions on imports arising from the fact that national legislation permits a specific shape of wine-bottle to be used only by certain national producers or dealers cannot be justified on grounds of public policy, whether or not the legislation carries penal sanctions; nor can they be justified by the protection of industrial and commercial property on the ground that such a bottle is traditionally used by national producers if identical or similar bottles are used in another Member State in accordance with a fair and traditional practice for marketing wines produced in that state.

Costs

39 The costs incurred by the government of the Federal Republic of Germany, the government of the Italian Republic and the Commission of the European Communities, which have submitted observations to the Court, are not recoverable. As these proceedings are, in so far as the parties to the main proceedings are concerned, in the nature of a step in the proceedings pending before the national Court, the decision on costs is a matter for that Court.

On those grounds,

The Court,

In answer to the questions submitted to it by the Landgericht Munchen II by order of 28 January 1983, hereby rules:

1. Article 30 of the EEC Treaty must be interpreted as meaning that the application by a Member State to imports of wine orginating in another Member State of legislation allowing only certain national producers to use a specific shape of bottle when the use of that shape or a similar shape of bottle accords with a fair and traditional practice in the state of origin constitutes a measure having an effect equivalent to a quantitative restriction.

2. Article 36 of the EEC Treaty must be interpreted as meaning that measures having an effect equivalent to quantitative restrictions on imports arising from the fact that national legislation permits a specific shape of wine-bottle to be used only by certain national producers or dealers cannot be justified on grounds of public policy, whether or not the legislation carries penal sanctions; nor can they be justified by the protection of industrial and commercial property on the ground that such a bottle is traditionally used by national producers if identical or similar bottles are used in another Member State in accordance with a fair and traditional practice for marketing wines produced in that state.