1.The Commission maintains that the Italian provisions must on analysis be considered as a measure having an effect equivalent to a quantitative restriction. In fact since advance payments are normal in international trade the Commission considers that the system, established by the said rules, of providing security through the bank, imposes upon traders resident in Italy special burdens, both as to administrative formalities and finance; the financial burdens are furthermore very considerable in the case of forfeiture of the security for failure to comply with the prescribed time-limit. Consequently such provisions have the effect of encouraging traders to prefer domestic transactions which are not liable to such charges.The Commission recalls in this connection that Directive No 70/50/EEC of 22 December 1969 (Official Journal, English Special Edition 1970 (1), p. 17) classifies as measures having an effect equivalent to quantitative restrictions those which hinder imports which might otherwise take place, including measures which make importation more difficult or more costly than the disposal of domestic production, and in particular those which “require, for imports only, the giving of guarantees or making of payment on account” (Article 2 (3) (i)).The Italian Government indeed maintains in the observations which it submitted in Joined Cases 206, 207, 209 and 210/80 that the rules in question form part of monetary policy and as such, through Article 104 of the Treaty in accordance with which “each Member State shall pursue the economic policy needed to ensure the equilibrium of its overall balance of payments and to maintain confidence in its currency ...”, fall outside the prohibition laid down in Article 30.The Commission does not dispute the monetary nature of the Italian rules but nevertheless remarks that Article 104 does not authorize any derogation from Article 30 since only the grounds laid down in Article 36 or protective measures within the meaning of Article 108 (3) permit derogations from Article 30.With regard to Article 108 (3) the fact that it makes provision for taking protective measures in the case of difficulties or the threat of serious difficulties as regards the balance of payments confirms that Article 104 does not by itself authorize derogations from Article 30: such derogations must be decided within the framework of Article 108. Since the Commission has not authorized the Iulian rules in question under Article 108 (3) that possibility of derogating from the prohibition laid down in Article 30 must be ruled out.With regard to Article 36 the Commission emphasizes that the need to ensure the equilibrium of the balance of payments does not feature amongst the possible justifications. According to the Italian Government the rules in question are indeed justified under Article 36 of the Treaty in so far as that article provides that public policy may be a justification. However, the Commission recalls in this connection that in accordance with the case-law of the Court Article 36 constitutes an exceptional provision which must be interpreted restrictively. Furthermore the Court has emphasized that Article 36 is directed to eventualities of a non-economic kind (judgment of 19 December 1961, Commission v Italy, Case 7/61 [1961] ECR 317).In the observations which it lodged in the four references for a preliminary ruling made by the Tribunale Civile, Rome, the Italian Government also invoked in its defence the judgment of 23 November 1978 (Regina v Ťbompton, Case 7/78 [1978] ECR 2247) in which the Co n ruled that the concept of public policy mentioned in Article 36 justified a prohibition of exports intended to protect “the right to mint coinage which is traditionally regarded as involving the fundamental interests of the State”. Nevertheless, the Commission maintains that there is no analogy between the circumstances considered in Case 7/78 and this case.
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