Here's a new judgment of the Court of Justice in
Joined cases C-23/04, C-24/04, C-25/04 Sfakianakis that requires the EC institutions and EC member States to give
full faith and credit of sorts to the judgments of the courts of a non member State that is party to an agreement with the EC in matters relating to the agreement. It is really a bold step.
The right to an effective judicial remedy is part and parcel of EC law. No doubt about that (see Case 222/84 Johnston, for instance). That means that the courts of the member States must be available to enforce EC law rights. It also means that courts of the member States must be available to enforce rights granted by Association Agreements with non member States because those agreements are part of the Community legal order (see Case 12/86 Demirel).
But now, in Joined cases C-23/04, C-24/04, C-25/04 Sfakianakis the Court of Justice has extended that principle requiring that the EC institutions and authorities of the member States should defer to the findings of courts of a non member State which is party to an association agreement with the EC on matters relating to the application of that agreement.
What happened was this, simplified somewhat. The EC had an association agreement with Hungary before Hungary joined the EC. There was a protocol setting out complex rules on, among other things, the origin of goods which benefitted from tariff free trade under the agreement. According to that protocol, the exporting state (Hungary) had to issue a certificate of origin attesting that the goods were produced there in order for them to benefit from duty free trade in the importing state.
Suzuki set up plant in Hungary and started exporting to EC member countries. The Hungarian authorities issued origin certificates for the cars. Then somehow the EC Commission started investigating whether the certificates were legit (a tip off from a competitor, maybe ?). Anyway, the Commission asked the Hungarians to look into it. Which they did. The Hungarians admitted that some of the certificates had been issued by them in error, stated that others were perfectly in order and that a third group were the subject of litigation in the Hungarian courts. Ultimately, the Hungarian courts confirmed the validity of the certificates in that third group. Meanwhile, the Greek customs authorities did not know what to do on import of the cars: Should they levy extra duties or not ? The Commission wrote the Greeks saying they should not levy the extra duties on the cars covered by the certificates upheld by the Hungarian courts. Still the Greek authorities were a bit hesitant as to what to do and ultimately the matter came to the Court of Justice.
The Court affirmed strongly that the Greek authorities must defer to the judgment of the Hungarian courts on the issue of the validity of the certificates issued by the Hungarians pursuant to the association agreement. If the authorities of a member State of import or the EC institutions failed to take into account the decisions delivered by the Hungarian courts’ ruling in carrying out their duty to review the legality of Hungarian administrative decisions, those authorities or institutions would infringe the exporter’s right to an effective judicial remedy.