Judgment — ECLI:EU:C:2010:113
Date: 2010-03-04
Language of the case: English
Court formation: Third Chamber
Subject matter: Taxation
Procedure: Action for failure to fulfil obligations - successful;Action for failure to fulfil obligations - unfounded
Origin: Ireland

Summary of the Judgment 1. Tax provisions – Harmonisation of laws – Taxes other than turnover taxes which affect the consumption of manufactured tobacco (Council Directive 95/59, as amended by Directive 2002/10, Art. 9(1)) 2. Member States – Obligations – Supervisory tasks assigned to the Commission – Duty of the Member States (Art. 10 EC and 226 EC) 1. A Member State fails to fulfil its obligations under Article 9(1) of Directive 95/59 on taxes other than turnover taxes which affect the consumption of manufactured tobacco, as amended by Directive 2002/10, where it imposes minimum retail prices for cigarettes, and where that system does not make it possible to ensure, in any event, that the minimum price imposed does not impair the competitive advantage which could result for some producers and importers of tobacco products from lower cost prices. Such a system, which furthermore fixes the minimum price by reference to the weighted average price on the market for each category of cigarettes, is likely to eliminate price differences between competing products and to cause prices to converge around the price of the most expensive product. That system therefore undermines the freedom of producers and importers to determine their maximum retail selling price, guaranteed by the second paragraph of Article 9(1) of Directive 95/59. The World Health Organisation Framework Convention on Tobacco Control cannot affect the compatibility or otherwise of such a system with Article 9(1) of Directive 95/59 since that convention imposes no actual obligation on the Contracting Parties with regard to price policies for tobacco products, and merely describes possible approaches by which to take account of national health objectives concerning tobacco control. Article 6(2) of the convention provides only that the Contracting Parties are to adopt or maintain measures which ‘may include’ implementing tax policies and, ‘where appropriate’, price policies, concerning tobacco products. Member States may not rely on Article 30 EC in order to justify an infringement of Article 9(1) of Directive 95/59 with reference to the objective of protection of health and life of humans. Article 30 EC cannot be understood as authorising measures other than the quantitative restrictions on imports and exports and the measures having equivalent effect envisaged by Articles 28 EC and 29 EC. The fact remains that Directive 95/59 does not prevent Member States from taking measures to combat smoking, which forms part of the objective of protecting public health. (see paras 45-46, 50-51, 57, operative part 1) 2. A Member State fails to fulfil its obligations under Article 10 EC by not providing the information required by the European Commission in order to enable it to fulfil its task of monitoring compliance with Directive 95/59 on taxes other than turnover taxes which affect the consumption of manufactured tobacco, as amended by Directive 2002/10/EC. (see para. 62, operative part 2)