The Commission has adopted and published new guidelines to assist the courts of member States' in applying EU state aid rules. The guidelines are supposed to support national courts and potential claimants in challenging domestic state aid, in particular in the recovery of illegal aid from the beneficiary, interim relief or possible damages actions. In addition, the guidelines cover how national judges can ask the Commission for information or opinions on how to apply of the state aid rules.
The Courts have made public some statistics for 2008 and made a press release. As always, there some good news and some bad news.
For the Court of Justice, there is a decline in the number of preliminary references made but a general increase in the number of cases brought before it (592 cases in 2008 as compared with 580 in 2007).
The Court of Justice has got cracking with cases too:
"As regards the duration of proceedings in 2008, there was a considerable improvement. Thus, for
preliminary rulings, the duration of proceedings was on average 16.8 months, that is 3 months less than in 2006. A comparative analysis shows that the average duration of preliminary ruling proceedings has reached its lowest level for 20 years. As regards direct actions and appeals, the average duration was 16.9 months and 18.4 months respectively (18.2 and 17.8 months respectively in 2007)."
The Court of Justice dealt with three urgent preliminary rulings, while the urgent procedure was requested in three other cases but not granted.
The number of new cases brought before the Court of First Instance has increased also: 629 cases were
brought in 2008, compared with 522 in 2007 and 432 in 2006.
The Court of First Instance has also pressed on with a lot of cases:
"The Court of First Instance dealt with 605 cases during 2008, which represents a 52% increase
compared with 2007, whilst the number of hearings held in 2008 doubled: 341 compared with 172 in 2007. The average duration of proceedings decreased: 24.5 months compared with 27.7 in 2007."
Well, it has happened, as feared. The Court of Justice has handed down its judgment in Case C-185/07 West Tankers and the result is as expected.
Remember ? It is that case about anti-suit injunctions issued to protect an arbitration clause. We noted it here and here while it was pending.
Anyway, we won't say much more than to indicate that the Court of Justice concluded that it is incompatible with Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters for a court of a Member State to make an order to restrain a person from commencing or continuing proceedings before the courts of another Member State on the ground that such proceedings would be contrary to an arbitration agreement.
Here's a judgment that's important not for what it decides but for what it does not decide. It is the judgment of the Court of Justice in Case C-110/05 Commission v. Italy and concerns the free movement of goods.
The Commission brought Article 226 proceedings against Italy because that state introduced legislation that prohibited motorcycles and quadricycles from towing a trailer. The Commission claimed that that prohibition was a restriction on the free movement of goods contrary to Article 28 EC.
The case is remarkable because the idea cropped up, as such ideas tend to do, that the rule adumbrated in Joined Cases C‑267/91 and C‑268/91 Keck and Mithouard that rules on selling arrangements were in principle outside the scope of the prohibition contained in Article 28 EC should be extended to rules on the use of products.
Thus, the Court of Justice reopened the procedure in this case after Advocate General Léger had handed down his opinion that the Italian regulations on the use of trailers was indeed contrary to Article 28 EC and suggested to the Court to find in favor of the Commission. The Court asked all the member States to take a position on whether product use rules should be taken beyond the reach of Article 28 EC. Funnily enough, many member States thought that would be a good idea. Then, Advocate General Bot, who replaced Advocate General Léger who had retired from the Court, handed down a second opinion, also against taking product use regulations outside the scope of Article 28 EC.
The Court of Justice for its part held that regulations on the use of products were within the scope of the prohibition contained in Article 28 EC.
The Court of Justice recalled that according to settled case-law, all trading rules enacted by member States which are capable of hindering, directly or indirectly, actually or potentially, intra-EC trade are to be considered as measures having an effect equivalent to quantitative restrictions and are, on that basis, prohibited by Article 28 EC (see, in particular, Case 8/74 Dassonville, paragraph 5). It added that Article 28 EC reflects the obligation to respect the principles of non-discrimination and of mutual recognition of products lawfully manufactured and marketed in other member States, as well as the principle of ensuring free access of Community products to national markets (see, to that effect, Case 174/82 Sandoz, paragraph 26; Case 120/78 Rewe‑Zentral (‘Cassis de Dijon’), paragraphs 6, 14 and 15; and Keck and Mithouard, paragraphs 16 and 17).
As a consequence, the Court held that obstacles to the free movement of goods which are the consequence of applying, to goods coming from other Member States where they are lawfully manufactured and marketed, rules that lay down requirements to be met by such goods constitute measures of equivalent effect to quantitative restrictions even if those rules apply to all products alike (see, ‘Cassis de Dijon’, paragraphs 6, 14 and 15; Case C‑368/95 Familiapress, paragraph 8; and Case C‑322/01 Deutscher Apothekerverband, paragraph 67).
In this particular case, the Court held that the restriction on the use of motorcycle trailers was contrary to Article 28 EC because consumers, knowing that they are not permitted to use their motorcycle with a trailer specially designed for it, have practically no interest in buying such a trailer (see, by analogy, Case C‑265/06 Commission v Portugal, paragraph 33, concerning the affixing of tinted film to the windows of motor vehicles). But the restriction was justified on the grounds of - now get this - road safety. It thus dismissed the Commission's action.
Honestly, the idea that Italy does anything to promote road safety is bound to provoke laughter. What about enforcing the seat belt laws a bit ? Or informing motorists in Rome that those pretty red, yellow and green lights are not just decorative but seek to convey some driving instructions ?
UPDATE: The judgment in Case C-142/05 Mickelsson and Roos is now out and confirms this judgment. See our post here.
At the end of last year, the Court of Justice handed down a rich and important judgment. The case is Case C-210/06 Cartesio. It concerns primarily corporation law and the right of the member State of incorporation to prevent a company from transferring its seat to another member State.
But there are other, procedural aspects, which we will deal with now, leaving the exciting corporation law for another time. As you'll see, the judgment deals with several aspects of the preliminary reference procedure established by Article 234 EC.
Here's the story. Cartesio, a company governed by Hungarian law, had its seat in Baja (Hungary). In November 2005, it filed an application with the Bács-Kiskun Megyei Bíróság (Regional Court of Bács-Kiskun), sitting as a Cégbíróság (commercial court), for registration of the transfer of its seat to Gallarate, in Italy, and, in consequence, for amendment of the reference to its company seat in the commercial register. That application was rejected: Hungarian law in force at the time did not allow a company incorporated in Hungary to transfer its seat abroad while continuing to be subject to Hungarian law as its personal law. The Cégbíróság held that such a transfer would require, first, that the company cease to exist and, then, that the company re-incorporate itself in compliance with the law of the country where it wishes to establish its new seat. Cartesio appealed against that decision with the Szegedi Ítélőtábla (Regional Court of Appeal of Szeged). That Regional Appeal Court in turn referred a number of questions to the Court of Justice on the compatibility of Hungarian law with EC law.
The Hungarian court also referred some questions on the preliminary reference procedure.
First it asked asked whether a court such as the referring court, hearing an appeal against a decision of a lower court, responsible for maintaining the commercial register, rejecting an application for amendment of information entered in that register, must be characterised as a court or tribunal entitled to make a reference for a preliminary ruling under Article 234 EC, regardless of the fact that neither the decision of the lower court nor the consideration by the referring court of the appeal against that decision takes place in the context of inter partes proceedings.
The Court of Justice held that the referring court was indeed a court for the purposes of Article 234 EC. It recalled that a court that can refer a question under Article 234 must be a body established by law, be permanent, exercise compulsory jurisdiction, have an inter partes procedure, and must apply rules of law in an independent fashion (see, Case C‑96/04 Standesamt Stadt Niebüll, paragraph 12, we noted up here). The Court remarked that Article 234 EC does not explicitly require the national proceedings to be inter partes but that it follows from that provision that a national court may make a reference to the Court of Justice only if there is a case pending before it and if it is called upon to give judgment in proceedings intended to lead to a decision of a judicial nature (Case C‑182/00 Lutz and Others, paragraph 13). The Court went on that where a court responsible for maintaining a register makes an administrative decision without being required to resolve a legal dispute, it cannot be regarded as exercising a judicial function. But, a court hearing an appeal lodged against a decision of a lower court responsible for maintaining a register, rejecting such an application, and which seeks the setting aside of that decision, which allegedly adversely affects the rights of the applicant, is called upon to give judgment in a dispute and is exercising a judicial function.
Accordingly, the appellate court must, as in the present case, be characterized as a court or tribunal within the meaning of Article 234 EC, with jurisdiction to refer a question to the Court for a preliminary ruling (see for similar situations, Case C‑300/01 Salzmann and Case C‑117/06 Möllendorf and Others).
The referring court also asked whether a decision of a national court referring a question to the Court of Justice can be subject to appeal which may result in an order to render the request for a preliminary ruling inoperative and an order to the court which made the preliminary reference to resume the national proceedings which had been suspended.
The Court of Justice held that where rules of national law apply which relate to the right of appeal against a decision making a preliminary reference, and under those rules the main proceedings remain pending before the referring court in their entirety, the order for reference alone being the subject of a limited appeal, Article 234 §2 EC means that the jurisdiction conferred by that provision on any national court to make a reference to the Court of Justice for a preliminary ruling cannot be called into question by the application of those rules, where they permit the appellate court to vary the order for reference, to set aside the reference and to order the referring court to resume the domestic law proceedings.
The Court of Justice recalled that, in the case of a court or tribunal against whose decisions there is a judicial remedy under national law, Article 234 EC does not preclude decisions of such a court by which questions are referred to the Court for a preliminary ruling from remaining subject to the remedies normally available under national law. Nevertheless, in the interests of clarity and legal certainty, the Court of Justice must abide by the decision to refer, which must have its full effect so long as it has not been revoked (Case 146/73 Rheinmühlen‑Düsseldorf, paragraph 3).
There's recently been a slight amendment to the procedure for the election of the President of the Court and of the Presidents of Chambers. The change ends the privilege of age.
The relevant provision of the Rules of Procedure (Article 7 §3 for the Court of Justice and Court of First Instance, Article 6 §3 for the Civil Service Tribunal) provided, before system before amendment:
"The elections provided for in this Article shall be by secret ballot. If a Judge obtains an absolute majority he shall be elected. If no Judge obtains an absolute majority, a second ballot shall be held and the Judge obtaining the most votes shall be elected. Where two or more Judges obtain an equal number of votes the oldest of them shall be deemed elected."
Now, the amended provision reads:
"The elections provided for in this Article shall be by secret ballot. The Judge obtaining the votes of more than half the Judges composing the Court shall be elected. If no Judge obtains that majority, further ballots shall be held until that majority is attained."
You can find the amendment for the Court of Justice here, for the Court of First Instance here, and for the Civil Service Tribunal here.