Commission of the European Communities v French Republic (21/84)

Contents

Judgment of the Court9 May 1985^noteIn Case 21/84Commission of the European Communities, represented by Michel van Ackere, Legal Adviser, acting as Agent, with an address for service in Luxembourg at the office of Manfred Beschel, a member of its Legal Department, Jean Monnet Building, Kirchberg,vFrench Republic, represented by François Renouard, acting as Agent, and by Gérard Boivineau, acting as Deputy Agent, with an address for service in Luxembourg at the French Embassy,THE COURTcomposed of: Lord Mackenzie Stuart, President, G. Bosco and C. Kakouris (Presidents of Chambers), T. Koopmans, U. Everling, Y. Galmot and R. Joliet, Judges,Advocate General: C. O. LenzRegistrar: D. Louterman, Administratorafter hearing the Opinion of the Advocate General delivered at the sitting on 14 March 1985,gives the following

Judgment

(The account of the facts and issues which is contained in the complete text of the judgment is not reproduced)

Decision

1By an application lodged at the Court Registry on 23 January 1984 the Commission of the European Communities brought an action before the Court under Article 169 of the EEC Treaty for a declaration that by refusing, without proper justification, to approve postal franking machines from another Member State the French Republic has failed to fulfil its obligations under Article 30 of the EEC Treaty.

2In France, as in the other Member States, the users of the postal service are in general authorized by the post office to use letter-franking machines, which enable them to save time and money. As those machines are used to collect postal charges, their release onto the market is made subject to the grant of approval by the postal authorities in order to prevent their fraudulent use. In France the rules for granting such approval were laid down most recently in Article 2 of the Interministerial Decree of 28 January 1980 on the use of letter-franking machines (Journal Officiel de la République Française 1980, p. 1190 N.C.). That provision states that ‘every type of franking machine must be approved by the Administration of Posts and Telecommunications following a favourable opinion from the Conseil technique [technical advisory board]’. Before it was amended on 7 March 1984, Article 3 of the decree provided that ’the machines, including the components and spare parts, must be exclusively of French manufacture, subject to any provisions of international agreements which may be applicable.

3The action now before the Court arises out of a complaint lodged with the Commission by a leading United Kingdom manufacturer whose postal franking machines are approved in a considerable number of countries but which has attempted unsuccessfully, since 1 January 1973, to obtain the approval of the French postal authorities.

4In support of its application the Commission contended that the general reference to international agreements in Article 3 of the interministerial decree did not clearly open the French market to franking machines imported from other Member States, that, as a result, it failed to satisfy fully the French Republic's obligations under Article 30 of the EEC Treaty and that, in any event, the manner in which the system of approval had been applied by the French postal authorities was incompatible with that provision, inasmuch as applications for approval submitted by the complainant had been repeatedly refused without proper justification.

5The French Government's only attempt to answer the Commission's argument was made in the telex message sent to the Commission on 5 February 1982 in reply to the letter inviting it to submit its observations. In that message it maintained that the requirement of French manufacture was accompanied by the proviso concerning international agreements in order to take account of the provisions of Community law regarding the free movement of goods, that the proviso was not merely formal since it had allowed two types of machines manufactured in the Federal Republic of Germany to be approved and marketed and that only reasons of a technical nature had prevented the approval requested by the complainant company from being granted. However, in its defence, the French Government merely stated that it intended to amend Article 3 of the Interministerial Decree of 28 January 1980 so as expressly to place machines imported from other Member States in the same position as machines of French manufacture. That intention was carried out in an interministerial decree of 7 March 1984 (Journal Officiel de la République Française 1984, p. 3092 N.C.), which provides that ‘the machines, including the components and spare parts, must be manufactured in France or imported from other Member States of the European Economic Community, subject to any provisions of international agreements which may be applicable’.

6At the hearing the Commission stated that, in view of that amendment, the action now concerned only the question of the compatibility with Article 30 of the attitude adopted by the French post office towards the complainant company.

7In its application the Commission set out the following summary of the steps which the complainant company took, to no avail, between 1973 and 1980:— 12 December 1972 to July 1975: delays in replying to letters and abortive contacts;— July 1975 to December 1976: correspondence resulting in various requests by the Centre national d'études techniques [National Technical Research Centre] for technical modifications to be made to the machines submitted for testing;— 12 February 1977 (with confirmation on 12 April 1977): final rejection of the application for approval because of ‘latent design faults’, although the applicant company was in the process of carrying out the modifications to the machines requested by the Centre national d'études techniques;— October 1977: rejection of a fresh application, submitted in August, on the ground that the French market was already adequately supplied with franking machines;— October 1980: the authorities rejected a further application, stating that the French Government's position had not changed but the application might be reconsidered once electronic equipment had been developed.

8It is also clear from statements made at the hearing on 6 December 1984 that a further application for approval, submitted on 25 May 1984, had, six months later, still not even reached the stage of the opening of the examination procedure, although the application partly concerned a model which had already been put through a certain number of tests by the competent departments on previous occasions.

9In the pre-litigation procedure the French Government did attempt to explain the refusal to grant an approval in February 1977. In its telex of 5 February 1982 it explained that ‘owing to the very design of its security mechanism, the machine in question could not be adapted satisfactorily to the French system of recording and collecting the charges. Under that system the franking charges are invoiced and paid after the service has been provided, unlike in other countries (including the United Kingdom), which have opted for a system of payment by deduction from a sum which is prerecorded on a counter in the machine and paid in advance by the users’. In reply to that argument the Commission stated in its application that ‘such technical considerations are in fact irrelevant since the complainant company, which was aware of this difference between the French and United Kingdom systems, took it into account by submitting, in April 1976, machines designed to accord with the French system ... The modifications required by the Centre national d'études techniques in December 1976 and carried out by the complainant company... concerned only certain aspects of the functioning of the security mechanisms. It is in any event clear that a significant difference of that nature, which is related to the actual design of the machine, could not have been the subject of quick, last-minute modifications before the commencement of the tests. Moreover, such incompatibility could have been detected when the machines were submitted ...’. The French Government has made no further attempt to contradict the Commission.

10In those circumstances the facts recounted by the Commission must be considered established. Those facts must be assessed in the light of the following principles.

11The fact that a law or regulation such as that requiring prior approval for the marketing of postal franking machines conforms in formal terms to Article 30 of the EEC Treaty is not sufficient to discharge a Member State of its obligations under that provision. Under the cloak of a general provision permitting the approval of machines imported from other Member States, the administration might very well adopt a systematically unfavourable attitude towards imported machines, either by allowing considerable delay in replying to applications for approval or in carrying out the examination procedure, or by refusing approval on the grounds of various alleged technical faults for which no detailed explanations are given or which prove to be inaccurate.

12The prohibition on measures having an effect equivalent to quantitative restrictions would lose much of its useful effect if it did not cover protectionist or discriminatory practices of that type.

13It must however be noted that for an administrative practice to constitute a measure prohibited under Article 30 that practice must show a certain degree of consistency and generality. That generality must be assessed differently according to whether the market concerned is one on which there are numerous traders or whether it is a market, such as that in postal franking machines, on which only a few undertakings are active. In the latter case, a national administration's treatment of a single undertaking may constitute a measure incompatible with Article 30.

14In the light of those principles it is clear from the facts of the case that the conduct of the French postal administration constitutes an impediment to imports contrary to Article 30 of the EEC Treaty.

15It must therefore be concluded that by refusing without proper justification to approve postal franking machines from another Member State, the French Republic has failed to fulfil its obligations under Article 30 of the EEC Treaty.

Costs

16According to Article 69 (2) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs. Since the French Republic has failed in its submissions, it must be ordered to pay the costs.

Operative part

On those grounds,THE COURT hereby:

(1).Declares that by refusing without proper justification to approve postal franking machines from another Member State, the French Republic has failed to fulfil its obligations under Article 30 of the EEC Treaty;

(2).Orders the French Republic to pay the costs.

Delivered in open court in Luxembourg on 9 May 1985.