EU Law: Analysis of Free Movement of Goods - Perrin's Case, 2020

This memorandum analyzes the legal issues arising from Mr. Perrin's business, specifically concerning the free movement of goods within the EU. The first issue addresses whether French restrictions on the import of nettle wine violate Article 34 of the Treaty on the Functioning of the European Union (TFEU), which prohibits quantitative restrictions and measures of equivalent effect. The analysis considers relevant case law, including Geddo, Cassis de Dijon, and Keck, and the potential application of Article 36 TFEU, which allows for restrictions on public health grounds. The second issue examines the applicability of Article 110 TFEU, which prohibits discriminatory internal taxation. The report analyzes whether Italian tax changes and French taxation on nettle wine are in violation of this article. The memorandum recommends that Mr. Perrin file a complaint with the WTO regarding the taxation issue, as France may be violating Article 110. The report concludes with a bibliography of relevant case law.

Running Head: EU LAW
EU LAW
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1EU LAW
LAW MEMORANDUM- 3
To: EU Division (Trainees)
From: Alison McBeal
Re: Mr. Perrin and Sprout and nettle wine
Date: 14 April 2020
It is to be said that the first question in issue is whether French restriction is violating the
provision of Article 34 The Treaty on the Functioning of the European Union or not.
According to the provision of Article 34, it forbids quantitative constraints on imports and
every measure that has similar effects between the Member States of the treaty. In the case of
Geddo1, it has been held that a quantitative restriction applies like total or partial restraint
over import, export or goods that are in transit. Furthermore, the rule of Measures Having
Equivalent Effect to Quantitative Restrictions (MEQR) as envisaged under Article 34 states
that any rule of trading that has been enacted by the Member States has the capability of
causing direct or indirect hindrance either actually or potentially upon the intra-Community
trade practice is said to be MEQR2. Therefore measures that have an equivalent effect upon
quantitative restrictions are recognized by Article 34. Another application of Article 34 can
be seen is the Cassis3 which states that Article 34 can also be applicable for the indistinctly
applicable rules that are non-discriminatory measures. In another case of Keck4, a contrary
judgment has been made which states that if a similar rule in the Dassonville case is creating
hindrances for the selling of domestic products and products of other market states then it
should not be decided by Article 34 as this can be referred as discriminatory. Therefore, in
this case though by the virtue of the judgment of the Keck case, Sunshine Desserts can ask for
1 Geddo v Ente Nazionale Risi 1971 ECR 865
2 Procurer du Roi v Dassonville 1974 ECR 837
3 Rewe-Zentral v Bundesmonopolverwaltung für Branntwein (1979) Case 120/78
4 C-267 and 268/91 Keck and Mithouard [1993] ECR I-6097

2EU LAW
LAW defense but French Government can say that the imposition was made according to the
provision of Article 36 of The Treaty on the Functioning of the European Union which states
that prohibition over the application of the provision of Article 34 and 35 can be made on the
ground of risk at public health by the good. In the case of Commission V. UK, the court stated
that it is permissible for a state to take the defense of Article 36 over imported of exported
goods to protect the public health principle of such state.5 However, the burden of proving
such risk is upon the member state asking for the defense of health risk along with the public
security proportionality test.6 Therefore, such restriction is compatible if not based on Article
34 but based on Article 36 as nettles are poisonous indeed.
In the second issue, the applicability of Article 110 of The Treaty on the Functioning of the
European Union is the question which states that no member state can put upon unnecessary
tax or other internal and external charges upon exported goods where the same charge is not
been imposed upon their domestic products which are similar or have a competitive
relationship with each other. In the case of Commission V. France, it has been held that if two
products compete with each other then imposing a tax on one and not on the other is said to
be breach of Art 110(2) The Treaty on the Functioning of the European Union7. In another
case of Wine8, it has been held that, if due to the prospect of two products competitive, a state
imposes a tax on one product to avoid future risk, then it is violating Article 110. Therefore, it
can be said that France is taking protective measures by imposing a tax upon the nettle wine
in their liquor market on the fear of losing the popularity of French grape wine.
5 Commission of the European Communities v. United Kingdom of Great Britain and Northern Ireland Case C-
127/05, Comm'n v. the U.K., 2007 E.C.R. I-4619.
6 Case 72/83 Campus Oil EU:C:1984:256.
7 Case 168/78 Commission v France (Tax on Spirits) [1980]
8 Case 170/78 Commission v UK (Wine and Beer) [1980]

3EU LAW
LAW
Recommendation:
Therefore, in this situation, Mr. Perrin can file a complaint in the WTO for the 2nd issue that
he has with the dealing of the product in France as France is violating the rule envisage in
Article 110.

4EU LAW
LAW
Bibliography:
Case study:
C-267 and 268/91 Keck and Mithouard [1993] ECR I-6097
Case 168/78 Commission v France (Tax on Spirits) [1980]
Case 170/78 Commission v UK (Wine and Beer) [1980]
Case 72/83 Campus Oil EU:C:1984:256.
Commission of the European Communities v. United Kingdom of Great Britain and Northern
Ireland Case C-27/05, Comm'n v. the U.K., 2007 E.C.R. I-4619.
Geddo v Ente Nazionale Risi 1971 ECR 865
Procurer du Roi v Dassonville 1974 ECR 837
Rewe-Zentral v Bundesmonopolverwaltung für Branntwein (1979) Case 120/78