Week 1
Lecture
➢ 4 Freedoms (art 26 (2) TFEU)
○ Freedom of goods
○ Freedom of services
○ Freedom of capital
○ Freedom of persons
➢ Models
○ Host State Model
■ Foreign entity enters host state and host state may apply rules
○ Harmonized Model
■ Uniform regulations for cros-border interactions
○ Home State Model
■ Jurisidiction of Home State applies to foreign operations
■ Mutual recognition: standards/laws in host states are equivalent to
those in home state
➢ David Ricardo: ‘internal market creates specialization and competitive advantages’
○ Issue: Based on situation of perfect competition and no-state intervention
➢ External dimension: custom union (art 28 TFEU)
○ Goods from third countries must comply with import formalities and customs
or CEEs have been imposed, before the right of FM (art 29 jo. 23(2) TFEU)
○ Common Custom Tarrifs (art 31 TFEU
○ Common Custom Policy (art 207 TFEU)
➢ FM of Goods (art 28 TFEU)
○ Goods:
■ wide variety of products which can be valued in money and are
capable of being the subject in a commercial transaction
○ Prohibition of CEEs or CDs between MS (art 30 TFEU)
■ Exception of scope
● Payment for a service rendered to importer
- Direct benefit for importer
→ No public health or statistical
information
- Payment only covers cost of service
● General system of internal dues
- Uniform non-discriminatory payment
- Strict equivalence is required
- Tax ⇒ art 110 TFEU
● Payment for inspection to comply with EU law
- Payment only covers cost of inspection
- Uniform obligation by EU law
- Prescribed in the general interest of EU
○ Custom duties:
■ Imposed charge on product when crossing the border
, ○CEEs:
■ Any charge, whatever method, purpose or destination imposed for
crossing the boarder even if non-discriminatory, non-protective, or
non-competition
○ Remedies to a breach of FM:
■ CEEs ⇒ MS must eliminate CEE
■ CD ⇒ Remuneration for unlawful payment
○ Tax Provisions (art 110 TFEU)
■ No discriminatory taxes in exces of that imposed on similar domestic
products
■ No taxation of such a nature to afford indirect protection
■ Similarity
● Formal test: same fiscal/statistical/custom classification
● Factual comparision: purpose/looks/production
No strict equality:
- Consumers needs +
- characteristics
■ Procedural criteria regarding the tax may also breach art 110(1)
■ Competition
● Factual test: Purpose, Alternatives
● Substiution: Cross-elasticity of demand
■ Stappenplan
1. Are the products similar or in competition with each other?
⇒ competition (art 110 zin 2)
⇒ similar (art 110 zin 1)
2. Specialties
- Competition → No protectionary effect allowed
- Similarity → strict equality required
➢ Relation art 30 TFEU v art 110 TFEU
○ Complimentary to different cases
○ Mutually exclusive
Seminar
The Union shall adopt measures with the aim of establishing or improving the functioning of
the internal market ex art 26(1)TFEU. The internal market will not include internal frontiers
and values the freedom of goods ex art 26 (2) TFEU. Ireland, a valued member of the Union,
imposes a ban on the importation of tea. The ban on the importation is a form of a
Quantative restriction on imports as described in art 34 TFEU. Ireland defends the ban due
to the possible endangerment of public health of the tea. Art 36 TFEU allows derogations
from art 34 in form of prohibitions or restrictions on imports on the basis of the protection of
health of life and humans. Prohibitions of restrictions may however not be a means of
arbitrary discrimination or disguised restriction on trade between MS. According to scientists
there is not much known about the side effect and recommend prohibition. The product is in
free circulation in MS, since it complied with import formalities and has levied with CD or
CEEs in Portugal, another MS in line with art 29 TFEU. Since the tea is in free circulation is
enjoys the right of FM of goods ex art 28 (2) jo. 30 TFEU. Irelands derogation is justified to
to the possible threat of public health ex art 36 jo. 34 TFEU.
,The Netherlands allows the free selling of the product but requires the tea to be labelled.
Quantitative restrictions and MEEs shall be prohibited by MS ex art 34 TFEU. The domestic
law is not a form of quantitative restriction, nor is it a payable charge in line with art 30
TFEU. The requirement for labeling is a Measure having Equivalent Effect (MEE). The MEE
excludes a measure relating to selling arrangement but entails a product-measure. Product-
bound measures fall under article 34, even if non-discriminatory. Violations of article 34 may
be justified on ground of art 36 TFEU. The national law regarding labelling is not exclusively
for imported products, but must also be followed by domestic products. The law is deprived
from public policy, a basis for derogation under art 36 TFEU.
Quantitative restrictions on imports and exports between MS is prohibited ex art 34 jo. 35
TFEU. Greece, a MS of the Union, requires the sale of Brazilian tea to be limited to
pharmacies. The domestic standard in question, is not a qualitative restriction, since it does
not conclude any maximimun or minimum standards nor does it regard the exports. Article
34 applies. The restriction of selling locations is a form of a Measure having equivalent effect
(MEE). The greek sellingmeasure regarding the limitation of Brasilian tea to pharmacies
entails a selling arrangement. The selling arrangement only targets Brasilian tea, excludes
domestic products and other tea-producing countries, therefore, the measure is of
discriminatory nature. A discriminatory measure of selling arangements falls under art 34
TFEU. A violation of art 34 could be exempted by a justified reasoning of art 36 TFEU. The
national measure has no lawful basis of being a restriction of free trade in the internal
market.
Theory
➔ Introduction
◆ Article 26 (2) TFEU: ‘ interal market shall comprise an area without internal
frontiers in which the free movement of goods, persons, services and capital
is ensured
◆ Four freedoms
- Goods
- Services
- Persons
- Capital
◆ Models of organization
● Host country control
○ The country where the economic activity takes place may
apply its national rules
○ Risk of discrimination
○ Sovereignty: high
○ National Legislatures play a dominant role
○ Welfare:
◆ Allows trades
◆ All participants become wealthier
○ Democracy: under-inclusive, interest of outsiders is neglected
● Harmonized model
, ○ Single unitary states ruled by only EU rules
○ Sovereignty: medium due to representation in EU council
○ EU legislature is dominant
○ Welfare
◆ Due to only 1 rule low transaction costs
◆ Other interests (environment)can be protected
● Issues
○ No room for diversity
○ Practical effectiveness
○ Inflexibility and rigidness
○ Democracy: low direct democratic legitimacy and
accountability
● Home country control
○ The country where the economic activity originates place may
apply its national rules
○ Significant trust is required
○ Courts play a crucial role because interpreting treaties
○ Sovereignty: absent
○ Welfare:
◆ Complex element of regulatory competition
● Pro’s
○ Increase in choice
○ Catalyst for innovation
○ Demotivation of predatory tendencies by
public officials
◆ Excessive taxes leads to mass
exits
● Con’s
○ Situations where costs/benefits fall
under different jurisdictions
○ Regulatory competition
◆ Attracting capital at the cost of
living standards
○ Democracy: distorted, capital preferred over workers
◆ Nature of the European market changes
● Common market:
○ freedom and fairnes, largely by legislative activity of
harmonized control of EU
○ First laid out in the Spaak Report
○ Incorporated in Treaty of Rome by creating European
Economic Community (EEC)
○ Merger of seperate national markets into a common market
○ Actions
◆ Supression of national protections impeding trade
● e.g. Tarrifs and quotas
◆ Termination of distortions of competition
◆ Support of underdeveloped regions in light of common
growth
Lecture
➢ 4 Freedoms (art 26 (2) TFEU)
○ Freedom of goods
○ Freedom of services
○ Freedom of capital
○ Freedom of persons
➢ Models
○ Host State Model
■ Foreign entity enters host state and host state may apply rules
○ Harmonized Model
■ Uniform regulations for cros-border interactions
○ Home State Model
■ Jurisidiction of Home State applies to foreign operations
■ Mutual recognition: standards/laws in host states are equivalent to
those in home state
➢ David Ricardo: ‘internal market creates specialization and competitive advantages’
○ Issue: Based on situation of perfect competition and no-state intervention
➢ External dimension: custom union (art 28 TFEU)
○ Goods from third countries must comply with import formalities and customs
or CEEs have been imposed, before the right of FM (art 29 jo. 23(2) TFEU)
○ Common Custom Tarrifs (art 31 TFEU
○ Common Custom Policy (art 207 TFEU)
➢ FM of Goods (art 28 TFEU)
○ Goods:
■ wide variety of products which can be valued in money and are
capable of being the subject in a commercial transaction
○ Prohibition of CEEs or CDs between MS (art 30 TFEU)
■ Exception of scope
● Payment for a service rendered to importer
- Direct benefit for importer
→ No public health or statistical
information
- Payment only covers cost of service
● General system of internal dues
- Uniform non-discriminatory payment
- Strict equivalence is required
- Tax ⇒ art 110 TFEU
● Payment for inspection to comply with EU law
- Payment only covers cost of inspection
- Uniform obligation by EU law
- Prescribed in the general interest of EU
○ Custom duties:
■ Imposed charge on product when crossing the border
, ○CEEs:
■ Any charge, whatever method, purpose or destination imposed for
crossing the boarder even if non-discriminatory, non-protective, or
non-competition
○ Remedies to a breach of FM:
■ CEEs ⇒ MS must eliminate CEE
■ CD ⇒ Remuneration for unlawful payment
○ Tax Provisions (art 110 TFEU)
■ No discriminatory taxes in exces of that imposed on similar domestic
products
■ No taxation of such a nature to afford indirect protection
■ Similarity
● Formal test: same fiscal/statistical/custom classification
● Factual comparision: purpose/looks/production
No strict equality:
- Consumers needs +
- characteristics
■ Procedural criteria regarding the tax may also breach art 110(1)
■ Competition
● Factual test: Purpose, Alternatives
● Substiution: Cross-elasticity of demand
■ Stappenplan
1. Are the products similar or in competition with each other?
⇒ competition (art 110 zin 2)
⇒ similar (art 110 zin 1)
2. Specialties
- Competition → No protectionary effect allowed
- Similarity → strict equality required
➢ Relation art 30 TFEU v art 110 TFEU
○ Complimentary to different cases
○ Mutually exclusive
Seminar
The Union shall adopt measures with the aim of establishing or improving the functioning of
the internal market ex art 26(1)TFEU. The internal market will not include internal frontiers
and values the freedom of goods ex art 26 (2) TFEU. Ireland, a valued member of the Union,
imposes a ban on the importation of tea. The ban on the importation is a form of a
Quantative restriction on imports as described in art 34 TFEU. Ireland defends the ban due
to the possible endangerment of public health of the tea. Art 36 TFEU allows derogations
from art 34 in form of prohibitions or restrictions on imports on the basis of the protection of
health of life and humans. Prohibitions of restrictions may however not be a means of
arbitrary discrimination or disguised restriction on trade between MS. According to scientists
there is not much known about the side effect and recommend prohibition. The product is in
free circulation in MS, since it complied with import formalities and has levied with CD or
CEEs in Portugal, another MS in line with art 29 TFEU. Since the tea is in free circulation is
enjoys the right of FM of goods ex art 28 (2) jo. 30 TFEU. Irelands derogation is justified to
to the possible threat of public health ex art 36 jo. 34 TFEU.
,The Netherlands allows the free selling of the product but requires the tea to be labelled.
Quantitative restrictions and MEEs shall be prohibited by MS ex art 34 TFEU. The domestic
law is not a form of quantitative restriction, nor is it a payable charge in line with art 30
TFEU. The requirement for labeling is a Measure having Equivalent Effect (MEE). The MEE
excludes a measure relating to selling arrangement but entails a product-measure. Product-
bound measures fall under article 34, even if non-discriminatory. Violations of article 34 may
be justified on ground of art 36 TFEU. The national law regarding labelling is not exclusively
for imported products, but must also be followed by domestic products. The law is deprived
from public policy, a basis for derogation under art 36 TFEU.
Quantitative restrictions on imports and exports between MS is prohibited ex art 34 jo. 35
TFEU. Greece, a MS of the Union, requires the sale of Brazilian tea to be limited to
pharmacies. The domestic standard in question, is not a qualitative restriction, since it does
not conclude any maximimun or minimum standards nor does it regard the exports. Article
34 applies. The restriction of selling locations is a form of a Measure having equivalent effect
(MEE). The greek sellingmeasure regarding the limitation of Brasilian tea to pharmacies
entails a selling arrangement. The selling arrangement only targets Brasilian tea, excludes
domestic products and other tea-producing countries, therefore, the measure is of
discriminatory nature. A discriminatory measure of selling arangements falls under art 34
TFEU. A violation of art 34 could be exempted by a justified reasoning of art 36 TFEU. The
national measure has no lawful basis of being a restriction of free trade in the internal
market.
Theory
➔ Introduction
◆ Article 26 (2) TFEU: ‘ interal market shall comprise an area without internal
frontiers in which the free movement of goods, persons, services and capital
is ensured
◆ Four freedoms
- Goods
- Services
- Persons
- Capital
◆ Models of organization
● Host country control
○ The country where the economic activity takes place may
apply its national rules
○ Risk of discrimination
○ Sovereignty: high
○ National Legislatures play a dominant role
○ Welfare:
◆ Allows trades
◆ All participants become wealthier
○ Democracy: under-inclusive, interest of outsiders is neglected
● Harmonized model
, ○ Single unitary states ruled by only EU rules
○ Sovereignty: medium due to representation in EU council
○ EU legislature is dominant
○ Welfare
◆ Due to only 1 rule low transaction costs
◆ Other interests (environment)can be protected
● Issues
○ No room for diversity
○ Practical effectiveness
○ Inflexibility and rigidness
○ Democracy: low direct democratic legitimacy and
accountability
● Home country control
○ The country where the economic activity originates place may
apply its national rules
○ Significant trust is required
○ Courts play a crucial role because interpreting treaties
○ Sovereignty: absent
○ Welfare:
◆ Complex element of regulatory competition
● Pro’s
○ Increase in choice
○ Catalyst for innovation
○ Demotivation of predatory tendencies by
public officials
◆ Excessive taxes leads to mass
exits
● Con’s
○ Situations where costs/benefits fall
under different jurisdictions
○ Regulatory competition
◆ Attracting capital at the cost of
living standards
○ Democracy: distorted, capital preferred over workers
◆ Nature of the European market changes
● Common market:
○ freedom and fairnes, largely by legislative activity of
harmonized control of EU
○ First laid out in the Spaak Report
○ Incorporated in Treaty of Rome by creating European
Economic Community (EEC)
○ Merger of seperate national markets into a common market
○ Actions
◆ Supression of national protections impeding trade
● e.g. Tarrifs and quotas
◆ Termination of distortions of competition
◆ Support of underdeveloped regions in light of common
growth
