It is a truth almost universally acknowledged that ECJ cases with apparently banal facts give rise to some of the most important decisions of EC constitutional law. Senor Costa's refusal to pay his trifling electricity bill caused the Court to pronounce on the supremacy of Community law (Case 6/64 Costa v. ENEL [1964] E.C.R 585). Italy's refusal to allow motorcycles to tow trailers (Case C-110/05 Commission v. Italy (trailers), Judgment of 10 Feb. 2009) led the Court to rule on another aspect of the relationship between EC law and national law: how far can the Treaty provisions on free movement constrain national freedom to regulate?
The Trailers case did not fit the standard free movement of goods model: it concerned neither a challenge to national product-requirements to which Case 120/78 Cassis de Dijon [1979] E.C.R 649 would apply (the national rules breach Article 28 unless justified), nor did it concern “certain selling arrangements” (CSAs) to which Joined Cases C-267/91 and C-268/91 Keck [1993] E.C.R I-6097, para. [16] would apply (the national rules do not breach Article 28 unless discriminatory). Instead, the case concerned a more difficult question: how to deal with a nationwide ban on the use of a product.
In an earlier case concerning restrictions on the use of powerboats (Case C-142/05 Mickelsson, not yet decided), AG Kokott favoured extending Keck to such situations, but with the caveat that where national rules prevent or severely restrict access to the market Article 28 would apply. By contrast, AG Bot in Trailers favoured a narrow reading of Keck, a case he felt constrained by but clearly did not like because of the artificial demarcation lines it drew. Adopting a strong integrationist perspective and a deep-felt desire for convergence across the freedoms, he urged the Court to apply a market access test.
The Court agreed with AG Bot. It identified three situations where a rule could be considered a measure having an equivalent effect to a quantitative restriction (“MEE”) and so breached Article 28: (1) distinctly applicable measures; (2) indistinctly applicable product requirements; and (3) “Any other measure which hinders access of products originating in other Member States to the market of a Member State”. It was the third limb that the Court relied on in Trailers: “a prohibition on the use of a product in the territory of a Member State has a considerable influence on the behaviour of consumers, which, in its turn, affects the access of that product to the market of that Member State”.
The inclusion of this third limb is the novel feature of Trailers. Because it has a significant overlap with the other two limbs, it is perhaps better to regard it as a “catch-all” for measures not easily classified under limbs (1) and (2). Further, the broad terms in which the third limb is drafted might suggest that even Keck-style CSAs may now be subject to a market access test.
The introduction of a market access test, the mainstay of the Court's jurisprudence in respect of the other freedoms, has received weighty support in the past, perhaps most famously from AG Jacobs in Case C-412/93 Leclerc-Siplec [1995] E.C.R I-179. However, even he recognized that a pure market access test risked catching too much national regulation in its net and so he suggested a threshold criterion: only where the measure is liable “substantially to restrict access to the market” should it breach Article 28. The Court may have tacitly acknowledged the need for some sort of threshold in Trailers when it referred to the “considerable influence” that a prohibition on the use of a product has on the behaviour of consumers.
Yet, what is actually meant by hindering market access? How can it be shown? It may be that the Court will examine the evidence for actual interference with trade, as it did in Case C–65/05 Commission v. Greece [2006] E.C.R I-10341, or likely interference, as on the facts of Trailers. Alternatively the Court might rely on the fact that the national rule generates additional costs, as it did in Case C-270/02 Commission v. Italy [2004] ECR I-1559, 19. However, as AG Poiares Maduro pointed out in Joined Cases C-158/04 & C-159/04 Alfa Vita [2006] E.C.R I-8135, not every imposition of supplementary costs is wrongful. Some costs can arise from a mere divergence between the legislation of the state of production of the goods and the state where they are marketed. To be considered a restriction on trade, he said, “the supplementary cost imposed must stem from the fact that the national rules did not take into account the particular situation of the imported products and, in particular, the fact that those products already had to comply with the rules of their State of origin”.
The effect of the decision in Trailers is that the market access test – first introduced by Case 8/74 Dassonville [1974] E.C.R 837 and then significantly curtailed by Keck – has risen, phoenix-like, from the ashes. The corollary of this is that Keck has been confined to situations concerning arrangements for sale in the narrowest possible sense and seems unlikely to be extended. In reaching this conclusion, the Court has once again subtly altered the balance of power between the EU and the Member States. While Keck identified an area in which national regulators were free to act, untrammeled by Community law, the (re)introduction of the market access test has shifted the balance back in favour of the Community, giving the Court the power to scrutinize an ever wider category of national measures for their compatibility with Article 28.
However, it is possible to detect a chink of light for those bemoaning the loss of state autonomy. In Trailers the Court appears to compensate for its (re)adoption of a broad market access test with a lighter touch both to judicial review of the justification put forward by Italy (road safety) and proportionality (cf. Case C-265/06 Commission v. Portugal, Judgement of 10 April 2008), with the result that the Italian rule was allowed to stand.
