62002CC0071_EN
Opinion of the Advocate-General
Opinion of the Advocate-General
I – Introduction
1. This reference for a preliminary ruling concerns the compatibility of a national prohibition on advertising with the provisions of the Treaty regarding the free movement of goods and, if appropriate, the freedom to provide services. Under Austrian law, advertisements stating that the goods offered for sale come from an insolvency estate are prohibited where, at the time of the advertisement, the goods no longer form part of the insolvency estate.
II – Legal framework
A – Council Directive 84/450/EEC of 10 September 1984 concerning misleading and comparative advertising (2)(3)
2. Article 1
‘The purpose of this directive is to protect consumers, persons carrying on a trade or business or practising a craft or profession and the interests of the public in general against misleading advertising and the unfair consequences thereof and to lay down the conditions under which comparative advertising is permitted.’ (4)
3. Article 2(2)
‘For the purposes of this directive:
...
2. “misleading advertising” means any advertising which in any way, including its presentation, deceives or is likely to deceive the persons to whom it is addressed or whom it reaches and which, by reason of its deceptive nature, is likely to affect their economic behaviour or which, for those reasons, injures or is likely to injure a competitor ...’
4. Article 3
‘In determining whether advertising is misleading, account shall be taken of all its features, and in particular of any information it contains concerning:
(a) the characteristics of goods or services, such as their availability, nature, execution, composition, method and date of manufacture or provision, fitness for purpose, uses, quantity, specification, geographical or commercial origin or the results to be expected from their use, or the results and material features of tests or checks carried out on the goods or services;
...’
5. Article 7
‘1. This directive shall not preclude Member States from retaining or adopting provisions with a view to ensuring more extensive protection, with regard to misleading advertising, for consumers, persons carrying on a trade, business, craft or profession, and the general public.
...’ (5)
B – The Austrian Bundesgesetz gegen den unlauteren Wettbewerb (Law on unfair competition; hereinafter ‘UWG’) (6)
6. Paragraph 2(1)
‘Misleading acts
Persons who, in the course of trade and for the purposes of competition, provide potentially misleading information on business matters, in particular as regards the nature, origin, production method or pricing of particular goods or services or of the entire range on offer, or as regards price lists, the method of procurement or source of supply of goods, awards won, the reason for or purpose of the sale or the quantity of stock, may be the subject of an application for an injunction ordering them to cease and, where they knew or must have known that the information was potentially misleading, an action for damages.’
7. Paragraph 30(1)
‘Prohibition on references to an insolvency estate in the context of the sale of goods
Public announcements or notices intended for a large audience which advertise the sale of goods originating from, but longer forming part of, an insolvency estate shall not make reference to the fact that the goods advertised come from an insolvency estate.’
III – Facts
8. The parties to the main proceedings are engaged in the purchase and sale of assets resulting from insolvency proceedings. Both parties were involved in the sale of the moveable assets of a construction company which had been compulsorily wound up. On 26 March 2001, the defendant in the main proceedings (hereinafter ‘Troostwijk’) acquired, with the authorisation of the insolvency court, machines, vehicles and construction materials belonging to the insolvency debtor. Those assets from the insolvency estate were to be sold on at an auction on 14 May 2001. Troostwijk advertised that auction as follows:
‘LARGE INSOLVENCY AUCTION
featuring machines, construction materials and a fleet of vehicles
from the INSOLVENCY ESTATE of the firm ...
MONDAY 14 MAY 2001
at 10:00 ...
TROOSTWIJK Gesellschaft m.b.H.
CONSULTANCY – AUCTIONS – SALES
...
www.troostwijkauctions.com’
9. The auction was advertised by means of a sales catalogue and a notice in the press. The notice was also posted on the website www.troostwijkauctions.com.
10. The plaintiff in the main proceedings (hereinafter ‘Karner’) obtained from the Handelsgericht Wien (Commercial Court, Vienna) an interlocutory injunction ordering Troostwijk to:
‘...
(1) refrain immediately, and until such time as the ... dispute has been settled definitively, from advertising the sale of goods, in the course of trade and for the purposes of competition, in public announcements or in notices intended for a large audience which make reference to the fact that the goods advertised come from an insolvency estate, in so far as those goods no longer form part of the insolvency estate; and
(2) explain to potential buyers at the public auction on 14 May 2001 that the defendant has acquired the goods from the insolvency administrator and that the auction is not being held on behalf of or on the instructions of the insolvency administrator, but on the defendant’s own account, and that it is not therefore an insolvency auction.’
11. The Oberlandesgericht Wien (Higher Regional Court, Vienna) upheld the injunction, which was based on Paragraph 30 of the UWG, and dismissed as groundless the appeal against the obligation to provide clarification. Troostwijk brought an extraordinary appeal on a point of law against that ruling before the Oberster Gerichtshof (Supreme Court).
12. The Oberster Gerichtshof has doubts as to whether the prohibition contained in Paragraph 30(1) of the UWG is compatible with Article 28 EC. It considers that, when adopting that measure, the legislature proceeded on the basis ‘... that the public prefers to purchase goods sold by an insolvency administrator because it assumes it is obtaining the goods at bargain prices, but that, in the case of an advertisement for the sale of goods from an insolvency estate, the public does not distinguish according to whether the goods are being sold by the insolvency administrator or by a third party who has acquired the goods from the insolvency estate. Third parties who have acquired goods from an insolvency estate must be prevented ... from exploiting that tendency on the part of the public’.
13. The national court takes the view that the prohibition applies irrespective of whether, in a particular case, there is a real danger of the public being misled or whether that danger is ruled out by the provision of appropriate explanatory information. It considers that the provision also applies where an advertisement states that the advertiser acquired the goods from the insolvency administrator, and even where a considerable difference in price remains despite the profit margin added on by the purchaser. In this case also, it submits, truthful and useful information is withheld from consumers.
14. In contrast, the general prohibition on misleading acts contained in Paragraph 2 of the UWG applies only to information that is in fact capable of misleading. The scope of that provision is thus more restricted than that of Paragraph 30 of the UWG, which is intended to apply to a special set of circumstances.
15. The national court takes the view that the prohibition on advertising contained in Paragraph 30 of the UWG may have an adverse effect on trade within the internal market. Where a trader is prevented from stating truthfully that he is offering goods at a particularly low price because he has acquired them from an insolvency administrator (at an even lower price), the consumer is denied that information. A person purchasing goods from an insolvency estate must also take into account in his advertising the different legislative provisions applicable in the various Member States of the Community.
16. Doubts are raised in the order for reference as to whether Paragraph 30 of the UWG may be regarded as a selling arrangement within the meaning of the judgment in Keck and Mithouard, (7) although these are not expanded upon.
17. The Oberster Gerichtshof also doubts whether the restriction may be justified on grounds of consumer protection. It considers the rule laid down in Paragraph 30 of the UWG to be disproportionate, since it also prohibits the dissemination of information which is useful and not capable of misleading. It has therefore referred the following question to the Court for a preliminary ruling:
‘Is Article 28 EC to be interpreted as precluding national legislation which, irrespective of the truthfulness of information, prohibits any reference therein to the fact that the goods come from assets in a bankruptcy, where, in public announcements or notifications intended for a large circle of persons, the notice given states that the goods offered for sale are from assets in a bankruptcy although the goods in question no longer form part of the assets in the bankruptcy?’
IV – Submissions of the parties to the proceedings
A – Admissibility of the reference for a preliminary ruling
18. Karner contests the admissibility of the reference for a preliminary ruling. It submits that the facts which gave rise to the proceedings do not exhibit a cross-border connection. Paragraph 30 of the UWG concerns advertising in Austria. The injunction at issue in the main proceedings relates to an advertisement in Austria for the sale in Austria of goods acquired from an Austrian insolvency estate. The parties to the main proceedings are both established in Austria.
19. Only Troostwijk addresses that argument. In its view, the cross-border connection in this case stems from the fact that the advertisement was published on the internet.
B – Existence of a restriction on the free movement of goods
20. Troostwijk is of the opinion that Paragraph 30 of the UWG restricts the free movement of goods. That provision, it contends, prohibits the dissemination of truthful information. For the potential buyer, that information is not only a matter of interest, but also an important factor in his decision whether or not to buy. That rule therefore represents an obstacle to the sale of the goods in question.
21. As the advertisement was published on the internet, it is of course not confined to one Member State. However, only in Germany is there a provision comparable with Paragraph 30 of the UWG: Paragraph 6 of the German Gesetz gegen den unlauteren Wettbewerb (Law on unfair competition). Troostwijk submits that, in other Member States, such as Belgium, France and Sweden, such an advertisement is, on the other hand, permissible. (The Swedish Government contests that submission and points to Paragraph 9(i) of the Swedish Marketing Law, which, it says, contains a similar provision.)
22. According to Troostwijk, the fact that the law differs from one Member State to another means that goods originating from an insolvency estate have to be advertised in different ways. That is very costly and also to some extent impracticable. It is not possible to differentiate in this way on the internet, as that medium does not permit advertisements to be limited to given regions.
23. Troostwijk considers the rule in Paragraph 30 of the UWG to be product-related. Information regarding the origin of a product has to do with the attributes of that product. For that reason, Paragraph 30 does not constitute a selling arrangement within the meaning of the judgment in Keck and Mithouard .
24. However, Karner, the Austrian Government, the Swedish Government and the Commission are of the opinion that the rule in Paragraph 30 of the UWG does not serve to regulate the movement of goods. They take the view that it constitutes a selling arrangement and that Article 28 EC is therefore not applicable.
25. In their view, the prohibition is not a product-related rule. It lays down no requirements as regards the designation, form, size, weight, composition, presentation, labelling or packaging of the goods. It is, rather, a sales-related rule which governs how the goods in question are sold. Advertising is the most effective method of sales promotion. In support of their argument, they refer to the judgments in Hünermund, (8) Leclerc-Siplec, (9) De Agostini (10) and Gourmet International, (11) in which the Court classified advertising measures as selling arrangements.
26. In their submission, the prohibition contained in Paragraph 30 of the UWG applies to domestic and foreign goods and economic operators in the same way. It does not restrict access to the market for foreign goods. The requirements laid down by case-law with respect to the legality of a selling arrangement are therefore met.
27. The Commission points out, furth ermore, that only total prohibitions are prohibited by Community law, since they have the effect of cementing national consumer trends. Paragraph 30 of the UWG, on the other hand, restricts advertising only in respect of one very specific piece of information, namely the fact that the goods advertised originate from a liquidation.
C – Justification for the restriction on account of overriding reasons in the general interest
28. Troostwijk is of the opinion that the restriction on the free movement of goods resulting from Paragraph 30 of the UWG is unjustified. That provision does not fulfil the conditions for the application of Article 7(1) of Directive 84/450, as it is not necessary on grounds of consumer protection in so far as it relates to the dissemination of truthful information. Troostwijk refers in this connection to the judgment in GB-INNO-BM . (12)
To that extent, it submits, Paragraph 30 of the UWG also infringes Directive 84/450.
29. On the assumption, as employed by the Court in its case-law, that the average consumer is reasonably well-informed, observant and sensible, protection must be provided only against information that is in fact capable of misleading him. That function is already performed by Paragraph 2 of the UWG. On the other hand, provisions which guard against a theoretical danger that the public will be misled, as Paragraph 30 of the UWG does, are not necessary.
30. Finally, Troostwijk also makes reference to the case-law of the European Court of Human Rights, according to which Article 10 of the European Convention on Human Rights (hereinafter ‘ECHR’) also covers the dissemination of advertisements. (13)
The prohibition on the dissemination of truthful information is not essential to the preservation of democratic order. As a result, Troostwijk submits, the prohibition contained in Paragraph 30 of the UWG also infringes Article 10 of the ECHR and is therefore contrary to Community law.
31. Karner, the Austrian Government and the Swedish Government, on the other hand, are of the opinion that the prohibition laid down in Paragraph 30 of the UWG is justified on grounds of consumer protection and fair trading. The consumer does not distinguish between goods sold by the insolvency administrator himself and goods acquired from the insolvency estate and then sold on by third parties. Advertising goods as coming from an insolvency estate serves as an enticement to the public. In those circumstances, the consumer wrongly assumes that a particularly good bargain may be obtained. Those expectations are disappointed where the goods are made more expensive by the profits of intermediaries. The prohibition contained in Paragraph 30 of the UWG is intended to guard against such disappointment.
32. The Austrian Government takes the view, furthermore, that the rule in Paragraph 30 of the UWG is consistent with Article 7(1) of Directive 84/450. In the context of answering the question whether advertising is misleading, it contends, account must be taken of all its features, and in particular of information concerning the origin of the goods, in accordance with Article 3 of that directive. As the directive establishes only a minimum level of protection, the Member States are entitled under Article 7 to introduce stricter measures in order to protect consumers.
33. The Swedish Government also points out that sales held by insolvency administrators are generally subject to special provisions, such as a requirement that the assets in the insolvency estate should be disposed of within a certain period of time. Those rules do not apply to sales held by third parties after the assets have been removed from the estate. It is therefore misleading to describe the resale of such goods as an ‘insolvency auction’, an ‘insolvency sale’ or in similar terms. The Swedish Government considers that protection is necessary not only on the ground of consumer protection but also in order to ensure fair trading.
34. Finally, Karner and the Swedish Government can see no alternative measures that would be equally effective and less restrictive. Consequently, they too regard the prohibition as proportionate.
V – Assessment
A – Directive 84/450 concerning misleading advertising
35. By Directive 84/450, the European legislature approximated the Member States’ provisions on misleading advertising. According to the findings of the national court, Paragraph 30 of the Austrian UWG, the provision at issue in these proceedings, is intended to afford protection against misleading advertising. The question therefore arises as to whether the prohibition on advertising contained in Paragraph 30 of the UWG is compatible with the provisions of that directive.
36. The directive does not contain express rules on advertisements for the sale by auction of goods from an insolvency estate. The requirement in Article 3 of the directive that, in determining whether advertising is misleading, account must be taken of all its features, and in particular of information concerning the characteristics of the goods, such as their commercial origin, seems to be relevant only to the prohibition contained in Paragraph 2 of the Austrian UWG, which concerns the need to establish that there is a danger that the public will be misled in a particular case. Paragraph 30 of the UWG is not covered by Article 3, since it seeks to combat a theoretical danger that the public will be misled. It does not require proof that there is a danger that the public will be misled in a particular case. Irrespective of how the advertisement is actually presented and whether it is in fact capable of misleading, describing the goods in question as coming from an insolvency estate is prohibited in so far as those goods no longer form part of the insolvency estate at the time when the advertisement is published. The approximation of legislation effected by Directive 84/450 does not cover the combating of such theoretical dangers.
37. However, the directive does not prohibit such provisions either. The last recital in the preamble to the directive and Article 7(1) expressly state that the directive does not preclude Member States from retaining or adopting provisions with a view to ensuring more extensive protection for consumers. These may include measures to combat a theoretical danger that the public will be misled. Directive 84/450 does not therefore preclude the prohibition contained in Paragraph 30 of the UWG.
B – Measures having equivalent effect to a restriction on imports (Article 28 EC)
38. As the prohibition at issue is not the subject of a Community harmonisation measure, it is necessary to examine the question, as referred by the national court, whether Articles 28 and 30 EC are to be interpreted as precluding a prohibition such as that contained in Paragraph 30 of the UWG.
1. Objection of inadmissibility
39. It is necessary to look first of all at the objection raised by Karner that the subject-matter of the main proceedings is of purely domestic significance and does not concern the movement of goods between the Member States, and that the reference for a preliminary ruling is therefore inadmissible.
40. The application of Austrian legislation to an advertisement published in Austria in connection with an auction taking place in Austria for the sale of goods acquired from an insolvency estate in Austria by an undertaking established in Austria is primarily a domestic state of affairs. This does not, however, mean that the reference for a preliminary ruling is inadmissible. This dispute is neither a device nor hypothetical within the meaning of the judgment in Foglia
v Novello . (14)
41. The question raised by Karner seeks rather to ascertain whether Article 28 EC is applicable to a situation such as that in the main proceedings. Karner takes the view that Paragraph 30 of the UWG is not incompatible with the rules of the Treaty on the free movement of goods because trade between Member States is not affected. However, determining the scope of Article 28 EC is a question of substantive law. The reference for a preliminary ruling is therefore admissible.
2. The existence of a restriction on the free movement of goods
42. Article 28 EC prohibits quantitative restrictions on imports and all measures having equivalent effect. According to the form of words used in Dassonville, a measure having an effect equivalent to a quantitative restriction on imports is any measure which is capable of hindering, directly or indirectly, actually or potentially, intra-Community trade. (15)
43. The advertisement at issue in the main proceedings was published on the internet. That enabled potential buyers in other Member States to access the advertisement and, if they so wished, to acquire goods at the auction. If such an advertisement is prohibited under Paragraph 30 of the UWG, trade between Member States is hindered at least indirectly and potentially as such advertising becomes impossible. The question is whether that is sufficient for the prohibition in Article 28 EC to apply or whether the solution to this problem should not instead be sought by recourse to the means available under national constitutional law.
44. Behind Karner’s argument that the subject-matter of this case is of purely domestic significance lies a completely different question which is much more difficult to answer: does Article 28 EC serve to safeguard the free exercise of commercial activities in the individual Member States, or must it be limited to the liberalisation of intra-Community trade? Ultimately, Troostwijk’s concerns undoubtedly have less to do with its sales prospects abroad than with overcoming an onerous advertising restriction that limits the exercise of its commercial activities at home. The question is whether this still falls within the scope of Article 28 EC.
45. These proceedings raise two questions as regards the scope of Article 28 EC: first, whether the prohibition on advertising at issue may be a selling arrangement which, since the judgment in Keck and Mithouard, is not in principle covered by the prohibition in Article 28 EC; and, secondly, whether the rule on advertising is to be measured against the provisions on the free movement of goods or the freedom to provide services.
46. Given that, by virtue of the first paragraph of Article 50 EC, provisions relating to the freedom to provide services are subordinate to those relating to the free movement of goods, it is necessary first of all to examine whether the rule in Paragraph 30 of the UWG falls within the scope of Article 28 EC.
3. Classification as a selling arrangement
47. According to earlier case-law, legislation which restricted or prohibited certain forms of advertising and certain means of sales promotion could, although it did not directly affect trade, be such as to restrict its volume because it affected marketing opportunities. (16)
It was on the basis of such an analysis that the Court held in Oosthoek, (17) GB-INNO-BM, (18) Aragonesa (19) and Yves Rocher (20) that prohibitions on advertising had restricted the free movement of goods.
48. However, that case-law was fundamentally changed by the judgment in Keck and Mithouard.
In that judgment, the Court drew a distinction between product-related and sales-related measures, excluding the latter in principle from the scope of Article 28 EC.
49. According to that judgment, the application to products from other Member States of national provisions restricting or prohibiting certain selling arrangements is not such as to hinder directly or indirectly, actually or potentially, trade between Member States within the meaning of the Dassonville
judgment. However, that is the case only on the twofold condition that those provisions apply to all relevant traders operating within the national territory and that they affect in the same manner, in law and in fact, the marketing of domestic products and of those from other Member States. Where those conditions are fulfilled, the application of such rules is, according to that judgment, not by nature such as to prevent products from another Member State from having access to the market or to impede such access any more than for domestic products, and as a result such rules fall outside the scope of Article 28 EC. (21)
The fact that national provisions may restrict the volume of sales generally, and hence the volume of sales of products from other Member States, is thus no longer considered sufficient to characterise such provisions as a measure having an effect equivalent to a quantitative restriction on imports. (22)
50. Since that departure from precedent, the Court has in principle regarded restrictions on advertising in connection with the sale of certain goods as sales-related rules not covered by the prohibition contained in Article 28 EC. Reference should be had, by way of example, to the judgments in Hünermund, (23) Leclerc-Siplec (24) and De Agostini . (25)
In Gourmet International, (26) on the other hand, the Court held that the free movement of goods had indeed been restricted, as the prohibition on advertising affected the marketing of imported goods more than that of domestic goods, but that the restriction was in principle justified on the ground of public health, provided merely that it was proportionate.
51. Paragraph 30 of the UWG concerns advertising in connection with the sale of certain goods and therefore, according to recent case-law, concerns a selling arrangement. On the basis of that case-law, it would therefore have to be concluded in this case that the prohibition in Paragraph 30 of the UWG does not fall within the scope of Article 28 EC.
52. Troostwijk sets against the classification of Paragraph 30 of the UWG as a sales-related measure the argument that the origin of goods has to do not with their sale but with their attributes. It contends that references to the origin of goods are product-related.
53. As indicated above, the origin of goods is described in Article 3(a) of Directive 84/450 as one of the ‘characteristics of goods’. On that basis, it seems entirely reasonable to regard the origin of goods as a distinctive attribute.
54. However, that does not mean that the prohibition on advertisements stating that the goods advertised come from an insolvency estate constitutes a product-related rule. Paragraph 30 of the UWG does not stipulate whether or not goods from an insolvency estate may be marketed in Austria, but how the sale of such goods may be advertised, namely without reference to the fact that they come from an insolvency estate. Paragraph 30 of the UWG prohibits advertising that suggests the goods may be obtained at a favourable price on account of their origin. However, this in no way alters the fact that the provision in question concerns advertisements for products, not the products themselves, or their composition, form, size, weight or origin. The prohibition in Paragraph 30 of the UWG is therefore a sales-related measure.
55. According to the aforementioned case-law, however, selling arrangements are excluded from the scope of Article 28 EC only where they apply to all relevant traders operating within the national territory and where they affect in the same manner, in law and in fact, the marketing of domestic products and of those from other Member States. (27)
56. The prohibition on advertising contained in Paragraph 30 of the UWG applies to all traders operating in Austria. The first condition is therefore met.
57. However, it is doubtful whether the second condition is also met. Troostwijk submits that advertisements referring to the fact that the goods advertised are from an insolvency estate are permissible in other Member States and cites Belgium, France and Sweden as examples. It contends that the use of the internet makes it impossible to differentiate between advertising in Austria and advertising in other Member States, and that, as a result, Paragraph 30 of the UWG hinders the free movement of goods in so far as it restricts advertising which is permissible in other Member States.
58. The Swedish Government contradicts Troostwijk’s submission and points out that Swedish law contains a provision comparable to Paragraph 30 of the UWG. According to the Commission, the decisive criterion is whether the rule concerned makes it more difficult or even impossible for foreign products to gain access to the market. It takes the view that the free movement of goods is adversely affected only where domestic distributors of goods are afforded a competitive advantage. In its submission, Paragraph 30 of the UWG does not do that.
59. The question raised by Troostwijk as to whether it is possible to differentiate according to the Member State concerned where an advertisement is published on the internet is a question of fact which it falls to the national court to examine. Nevertheless, irrespective of the answer to that question, it remains the case that, according to the submissions of the defendant in the main proceedings, such a prohibition does not exist in all Member States, so that the advertisement prohibited in Austria would be permissible in some Member States.
60. The use of uniform advertising concepts throughout the internal market requires protection under Community law against obstacles which impede such activities. The Court has already ruled as such in Yves Rocher and Mars. (28)
The internet creates for traders new opportunities which, in the absence of Community rules and because the relevant legislation differs from one Member State to another, they have as yet been unable fully to utilise. The obstacles which this creates must not make it impossible to exercise the fundamental freedoms safeguarded by the Treaty.
61. The question of the extent to which this issue can be resolved by Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (Directive on electronic commerce; (29) hereinafter ‘the E-Commerce Directive’) is immaterial to this case. The directive was not in force in Austria at the relevant time, May 2001. Transposition of the directive did not occur until the E-Commerce-Gesetz (30) (E-Commerce Law) entered into force on 1 January 2002.
62. The requirement, as referred to by Troostwijk, of compliance with different advertising rules depending on the Member State concerned, and the consequent need to adjust advertisements accordingly could constitute discrimination against imported goods in so far as undertakings not established in Austria are obliged to adjust their Community-wide advertising for the Austrian market in accordance with Paragraph 30 of the UWG. The mere act of determining what is permissible under the law of each Member State incurs considerable costs. (31)
The rule in Paragraph 30 of the UWG therefore means that advertising imported goods is more expensive. The question is whether such additional expenditure alone is sufficient to justify classification of the rule in question as a measure having an effect equivalent to a quantitative restriction.
63. The judgment in Yves Rocher
can hardly be relied upon to answer that question, as it predates the judgment in Keck and Mithouard, which introduced the distinction between sales- and product-related measures.
64. Ultimately, however, more recent case-law appears to indicate that that question must be answered in the negative. On the one hand, the additional costs relate not to the adjustment of the goods to be imported but to the adjustment of the advertising, that is to say, a sales-related factor. According to the distinction drawn in the judgment in Keck and Mithouard, such additional financial expenditure would probably have to be regarded as not being covered by Article 28 EC.
65. On the other hand, even in its more recent case-law, the Court has taken into account whether the relevant rule makes it difficult for foreign goods to gain access to the market. In Gourmet International, it held this to be true of a prohibition on all advertising directed at consumers in the form of advertisements in the press, on the radio and on television, the direct mailing of unsolicited material or the placing of posters on the public highway. (32)
However, in contrast to the circumstances of that case, Paragraph 30 of the UWG does not impose a total prohibition on the advertising of goods that come from an insolvency estate. The prohibition applies only to advertisements which make reference to the fact that the goods advertised originate from a liquidation. Any other means of advertising the marketed goods may be employed, provided of course that they comply with the specific prohibition on misleading acts contained in Paragraph 2 of the UWG. It may to that extent be assumed that the rule in question ultimately does not make it more difficult for products from other Member States to gain access to the market than it does for domestic products, with which the consumer is naturally more familiar. Moreover, there is nothing in the submissions of the parties to suggest that Paragraph 30 of the UWG makes it more difficult for goods from other Member States to gain access to the Austrian market.
66. Consequently, it may be assumed that Paragraph 30 of the UWG affects in the same manner, in law and in fact, the marketing of domestic products and of those from other Member States. The conditions governing classification as a selling arrangement falling outside the scope of Article 28 EC are therefore met.
67. It must therefore be concluded that the prohibition on advertising contained in Paragraph 30 of the UWG, as a sales-related measure (selling arrangement), does not fall within the scope of Article 28 EC.
4. Justification for the restriction on account of overriding reasons in the general interest
68. In the alternative, in the event that the Court does not concur with that analysis, but proceeds on the assumption that Paragraph 30 of the UWG gives rise to a restriction on the free movement of goods, the question remains whether that rule is justified, if at all, under Article 30 EC.
69. According to Article 30 EC, Article 28 EC does not preclude restrictions on imports justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; the protection of national treasures possessing artistic, historic or archaeological value; or the protection of industrial and commercial property. No such grounds of justification are present in this case.
70. In addition to the general rule in Article 30 EC, it is settled case-law that, in areas where Community law does not provide for harmonisation, obstacles to intra-Community trade resulting from disparities between provisions of national law must be accepted in so far as such provisions are applicable to domestic and imported products without distinction and may be justified as being necessary in order to satisfy overriding requirements relating inter alia to consumer protection. However, in order to be permissible, such provisions must be proportionate to the objective pursued and that objective must not be capable of being achieved by measures which are less restrictive of intra-Community trade. (33)
71. As indicated above, Directive 84/450 does not govern cases where advertising is restricted by a total prohibition on grounds of a theoretical danger that the public may be misled. The situation in this case is therefore not harmonised by Community law. Furthermore, Paragraph 30 of the UWG is applicable to domestic and imported goods in the same way. The first two conditions are therefore met. The question is whether Paragraph 30 is necessary on the grounds of consumer protection and fair trading, the grounds on which the Austrian legislature adopted it, according to the national court, and whether it is proportionate.
72. In the Court’s case-law, consumer protection and fair trading are considered to be overriding requirements in the general interest which are in principle capable of justifying restrictions on the free movement of goods. (34)
73. Troostwijk counters that justification for the advertising restriction by reference to the right to freedom of expression as enshrined in Article 10 of the ECHR. In its view, although that right may be restricted, the suppression of truthful information is not essential to the preservation of democratic order.
74. It is true that the Court does not assess the compatibility with the ECHR of national rules which do not fall within the scope of Community law. On the other hand, where such rules do fall within the scope of Community law, and reference is made to the Court for a preliminary ruling, it must provide all the criteria of interpretation needed by the national court to determine whether those rules are compatible with the fundamental rights the observance of which the Court ensures and which derive in particular from the ECHR. In particular, where a Member State relies on a provision which permits the restriction of fundamental freedoms in order to justify rules which are likely to obstruct the exercise of fundamental freedoms, such justification, provided for by Community law, must be interpreted in the light of the general principles of law and in particular of fundamental rights. Thus the national rules in question can fall under the exceptions provided for by Community law only if they are compatible with the fundamental rights the observance of which is ensured by the Court. It follows that, in such a case, it is for the national court and, if necessary, the Court of Justice to appraise the application of those provisions having regard to all the rules of Community law, including freedom of expression, as embodied in Article 10 of the ECHR, as a general principle of law the observance of which is ensured by the Court. (35)
75. According to the case-law of the European Court of Human Rights, all forms of expression are deserving of protection under Article 10(1) of the ECHR. That includes information of a commercial nature, (36) that is to say the dissemination of information, the expression of ideas or the dissemination of images in the course of the promotion of an economic activity and the corresponding right to receive such information. Advocate General Fennelly, too, argued in an Opinion in proceedings concerning the directive on tobacco advertising that advertising should be regarded as forming part of the freedom of expression within the context of Community law. (37)
76. On that analysis, it must be concluded that the prohibition on advertising contained in Paragraph 30 of the UWG restricts the freedom of expression. That restriction is made all the more severe by the fact that the prohibition applies to the dissemination of truthful information.
77. It must therefore be asked whether the restriction is justified. Article 10(2) of the ECHR contains an express reservation: freedom of expression may be restricted in so far as such restriction is necessary and provided for by law. The European Court of Human Rights has confirmed on numerous occasions that advertisements, inter alia, may be subjected to restrictions and prohibitions. In its judgment in Markt Intern, it regarded as permissible restrictions adopted in order to protect the reputation and rights of others. (38)
In Casado Coca it recognised that rules of professional conduct pursue a legitimate aim for the purposes of Article 10(2) and are therefore capable of justifying a restriction of advertising opportunities. (39)
The European Commission of Human Rights takes the view that advertising may be subjected to more extensive restrictions than the expression of political ideas. (40)
78. In the aforementioned Opinion in the case concerning the directive on tobacco advertising, Advocate General Fennelly argued, by reference to the judgment in Markt Intern, that restrictions should be considered permissible where the competent authorities regard them as necessary on reasonable grounds. In his view, beyond its role in promoting economic activity, in respect of which the legislator properly enjoys considerable discretion to impose public-interest restrictions, commercial expression does not normally perform a wider social function of any significance. (41)
79. Against that yardstick, a restriction on advertising on grounds of consumer protection and fair trading, as imposed by Paragraph 30 of the UWG, would in principle probably have to be regarded as compatible with Article 10 of the ECHR, provided that there is no equivalent means of achieving those objectives which is less restrictive of the fundamental right to freedom of expression.
80. It is therefore necessary to examine now whether the prohibition in Paragraph 30 of the UWG is proportionate. The question is whether the prohibition on advertising is necessary. It must be taken into account when answering that question that the rule at issue prohibits the provision of truthful information. The goods offered for sale by auction do originate from a liquidation. They have, however, already been removed from the insolvency debtor’s estate at the time of the auction.
81. As the Swedish Government correctly observes, a sale organised by an insolvency administrator is normally characterised by the need to realise the assets of the undertaking as soon as possible and compliance with certain legislative provisions. That affects the price that can be obtained for the goods offered. The same cannot be said of an auction such as that advertised by the defendant in the main proceedings. The defendant is not subject, when organising auctions, to the provisions applicable to an insolvency administrator. Nor is it under pressure to sell the goods as quickly as possible. Those differences justify the drawing of a clear distinction between advertising for an auction such as that held by the defendant in the main proceedings and that for an auction held by an insolvency administrator.
82. The heading of the advertisement which gave rise to the main proceedings, ‘Insolvency Auction’, and the statement that the goods to be auctioned originate ‘from the insolvency estate’ may blur that distinction. It can be concluded in this respect that a prohibition on advertisements stating that the goods advertised come from an insolvency estate is necessary in the interests of consumer protection and fair trading.
83. It therefore remains to be considered whether the prohibition is proportionate. It is certainly capable of preventing any danger that consumers will be misled. However, it is questionable whether the objective sought could also be achieved by less stringent means. A less restrictive measure might be the requirement of a statement in the text of the advertisement making it clear that the auction is not being held by or on behalf of the insolvency administrator and that the goods auctioned will no longer form part of the insolvency estate at the time of the auction.
84. That is the purport of the interlocutory injunction from the Handelsgericht Wien ordering Troostwijk to explain to potential buyers at the public auction on 14 May 2001 that the goods had been acquired from the insolvency administrator and that the auction was not being held on his behalf or on his instructions, but on Troostwijk’s own account, and that it was not therefore an insolvency auction. (42)
Through that information, the aforementioned two differences between the two types of auction are made apparent for these purposes in the advertisement. Consumer protection and fair trading would be ensured without the need to suppress truthful information concerning the origin of the goods.
85. In its judgment in Yves Rocher
too, the Court considered the provision of such clarification to the consumer to be a less stringent measure than the suppression of truthful information. (43)
Support for the solution advocated here can therefore be taken from that judgment.
86. Consequently, it must be concluded that a total prohibition on advertisements stating that the goods advertised come from an insolvency estate goes beyond what is necessary in the interests of consumer protection and fair trading, and is therefore disproportionate. The prohibition cannot therefore be justified by reference to Article 30 EC or to overriding reasons in the general interest.
C – Measures having equivalent effect to a restriction on exports (Article 29 EC)
87. Troostwijk’s submission that the prohibition in Paragraph 30 of the UWG means that an advertisement for an auction to be held in Austria, which is permitted in other Member States, cannot be used because it is not possible to vary the advertisement according to the Member State concerned raises the question whether Paragraph 30 of the UWG constitutes a measure having equivalent effect to a quantitative restriction on exports within the meaning of Article 29 EC. The fact that an advertisement published on the internet and permitted in other Member States is precluded by the rule in Paragraph 30 of the UWG is capable, at least indirectly and potentially, of having an effect on the sale of goods auctioned in Austria to buyers in other Member States.
88. Although the order for reference expressly raises only the question of the interpretation of Article 28 EC, the Court has on numerous occasions in the past held that it must extract from all the factors provided by the national court the elements of Community law requiring an interpretation, having regard to the subject-matter of the dispute. (44)
The order for reference does not therefore preclude a legal assessment of other provisions of the Treaty.
89. It is settled case-law, however, that Article 29 EC precludes only those national measures that have as their specific object or effect the restriction of patterns of exports and establish a difference in treatment between the domestic trade of a Member State and its export trade in such a way as to provide a particular advantage for national production or for the domestic market of the State in question. (45)
According to the findings of the referring court, the purpose of the prohibition on advertising, on the other hand, is not to govern the movement of goods but to ensure consumer protection and fair trading. Consequently, given the lack of a specific restriction on exports, the rule in question falls outside the scope of Article 29 EC.
D – Freedom to provide services (Article 49 EC)
90. If the approach I have set out above is adopted and the prohibition in Paragraph 30 of the UWG is classified as a selling arrangement that falls outside the scope of Article 28 EC, the question arises whether that rule falls within the scope of the provisions on the freedom to provide services and, if so, to what extent it is consistent with those provisions.
91. It is at this point that the aforementioned problem regarding the distinction to be drawn between the scope of Article 28 EC and that of Article 49 EC becomes clear. The prohibition in question concerns advertising. If advertising is seen as part of the general commercial process of selling goods, that rule must be examined exclusively from the point of view of the free movement of goods. However, if advertising is seen as a separate activity, the question arises whether the prohibition in Paragraph 30 of the UWG is compatible with the provisions on the freedom to provide services.
92. The judgments in GB-INNO-BM
and Schindler
demonstrate how difficult it can be to draw that distinction in practice. Both cases concerned the distribution of advertising material. In the judgment in GB-INNO-BM, the Court examined the distribution of promotional literature exclusively from the point of view of the free movement of goods. (46)
In Schindler, on the other hand, the mailing of advertising material regarding a foreign lottery was classified as a service. (47)
93. It is clear from this that the decision must be made not in the abstract, but in the light of the specific circumstances of each particular case. For instance, if the advertisement is produced and published by the seller himself, it should logically be seen as part of the sale of the goods in question. That might apply, for instance, to a sign displayed in retail outlets which has been written by the seller himself. The decision will probably have to be different where the advertisement is produced and published by a third party, for example by an independent advertising agency. Such an activity would in principle have to be classified as falling within the scope of Article 49 EC.
94. The order for reference contains no information on the factual circumstances surrounding the advertisement on the internet. The following observations can therefore serve only as practical guidance on how the national court should assess the facts of the case in the context of Community law if it establishes that the advertisement in question was placed on the internet by a third party.
95. The main proceedings concern an advertisement which was published inter alia on the website ‘www.troostwijkauctions.com’. The national court will first of all have to ascertain whether the defendant in the main proceedings placed the advertisement on the internet itself or whether that was done by a third party. If it is the former, the facts of the case will have to be assessed exclusively in the context of the free movement of goods; if it is the latter, the prohibition in Paragraph 30 of the UWG will have to be examined with a view also to determining its compatibility with the freedom to provide services.
96. It is true that, at the hearing, Troostwijk explained, in response to a question from the Court, that it had not used an advertising agency but had placed the notice on the internet itself. However, that does not rule out the application of the provisions on the freedom to provide services, since the auction notice at issue in the main proceedings, which is reproduced in the order for reference, gives the internet address ‘www.troostwijk.com’. That is the home page of the parent company of the defendant in the main proceedings, which is established in the Netherlands. That site currently contains a list of dates of auctions taking place across Europe, and includes advertisements comparable to that used by the defendant in the main proceedings and catalogues listing the goods offered for sale at each auction. This suggests that the advertisement in question was placed on the internet by the parent company, which operates throughout Europe and is established in the Netherlands. If the parent company and the subsidiary each have their own legal personality, the national court will have to rule on whether Paragraph 30 of the UWG is compatible with the provisions on the freedom to provide services.
97. The freedom to provide services could have been restricted in two ways. If the advertisement was placed on the internet by a third party, including a parent company with independent legal status, which is established in another Member State, the freedom to provide services could have been restricted in so far as Paragraph 30 of the UWG totally prohibits the distribution of the advertisement in Austria. The service in question could not in those circumstances have been provided for the Austrian company Troostwijk.
98. If, however, the third party is also established in Austria, the freedom to provide services could have been restricted in so far as the advertisement cannot be distributed via the internet to other Member States where such advertisements are in principle permitted. Troostwijk submitted, without contradiction, that it is not possible to vary the publication of advertisements according to the Member State concerned. That being the case, the only way in which Paragraph 30 of the UWG could be complied with would be for no advertisements to be placed on the internet. This, moreover, is consistent with the home State principle. That principle requires compliance with the provisions applicable in the Member State from which the relevant communication is sent. The home State principle is enshrined inter alia in Article 3(1) of the E-Commerce Directive and has been applied by the Court in the context of the broadcasting of television advertising. (48)
99. In those circumstances, it would fall to the national court to examine whether the restriction in Paragraph 30 of the UWG is necessary in order to achieve one of the objectives referred to in Article 46 EC or for overriding reasons in the general interest, whether it is proportionate to that purpose, and whether those objectives or overriding reasons cannot be served by less restrictive measures.
100. The grounds of justification listed in Article 46 EC do not seem relevant to the main proceedings. However, it is settled case-law that consumer protection and fair trading in principle constitute overriding reasons in the general interest which are capable of justifying restrictions on the freedom to provide services. (49)
It is true that Paragraph 30 of the UWG seeks to protect consumers and ensure fair trading. However, for the reasons given in the context of the examination of the provisions on the free movement of goods, the rule laid down in Paragraph 30 of the UWG probably has to be regarded as disproportionate in this context too. A distinction in the advertisement at issue making it clear that it is not an advertisement for an auction of assets in an insolvency estate organised by an insolvency administrator would be just as effective in ensuring consumer protection and fair trading as the total prohibition contained in Paragraph 30 of the UWG. Consequently, any restriction of the freedom to provide services would be unjustified.
VI – Conclusion
101. It must therefore be concluded that Paragraph 30 of the UWG does not fall within the scope of Article 28 or Article 29 EC. As regards the freedom to provide services, the national court must first clarify the relevant facts before it can be decided whether Paragraph 30 of the UWG is incompatible with Article 49 EC. That measure cannot be justified by reference to overriding reasons in the general interest because it is disproportionate.
102. I therefore propose that the question referred be answered as follows:
Article 28 EC is to be interpreted as meaning that it does not preclude national legislation which prohibits any reference, however true, to the fact that goods come from an insolvency estate, where public announcements or notices intended for a large audience advertise the sale of goods originating from, but no longer forming part of, an insolvency estate. Such legislation may nevertheless constitute a disproportionate restriction on the freedom to provide services, if it can properly be assessed against the provisions relating to that freedom (Article 49 EC).
(1) .
(2)
–	Title as amended by Directive 97/55/EC of the European Parliament and of the Council of 6 October 1997 amending Directive 84/450/EEC concerning misleading advertising so as to include comparative advertising (hereinafter ‘Directive 97/55’), OJ 1997 L 290, p. 18.
(3)
–	OJ 1984 L 250, p. 17.
(4)
– Text as amended by Directive 97/55/EC (OJ 1997 L 290, p. 18).
(5)
– Text as amended by Directive 97/55.
(6)
–	BGBl. No 448/1984, most recently amended by BGBl. I No 136/2001.
(7)
–	Judgment in Joined Cases C-267/91 and C-268/91 Keck and Mithouard
[1993] ECR I-6097, paragraph 16 et seq.
(8)
–	Judgment in Case C-292/92 Hünermund
[1993] ECR I-6787.
(9)
–	Judgment in Case C-412/93 Leclerc-Siplec
[1995] ECR I-179.
(10)
–	Judgment in Joined Cases C-34/95, C-35/95 and C-36/95 De Agostini
[1997] ECR I-3843.
(11)
–	Judgment in Case C-405/98 Gourmet International
[2001] ECR I-1795.
(12)
–	Judgment in Case C-362/88 GB-Inno-BM [1990] ECR I-667, paragraph 18.
(13)
–	Eur. Court H. R., Markt Intern Verlag GmbH and Klaus Beermann judgment of 20 November 1989, Series A no 165.
(14)
–	Judgments in Case 244/80 Foglia
[1981] ECR 3045, paragraph 18, and Case C-83/91 Meilicke [1992] ECR I-4871, paragraph 25.
(15)
–	Judgments in Case 8/74 Dassonville [1974] ECR 837, paragraph 5, and Keck and Mithouard
(cited above in footnote 7, paragraph 11).
(16)
–	Judgments in Case 286/81 Oosthoek’s Uitgeversmaatschappij
[1982] ECR 4575, paragraph 15, GB-Inno-BM
(cited above in footnote 12, paragraph 7), and Keck and Mithouard
(cited above in footnote 7, paragraph 13).
(17)
–	Judgment in Oosthoek
(cited above in footnote 16).
(18)
–	Judgment in GB-INNO-BM
(cited above in footnote 12).
(19)
–	Judgment in Joined Cases C-1/90 and C-176/90 Aragonesa
[1991] ECR I-4151.
(20)
–	Judgment in Case C-126/91 Yves Rocher
[1993] ECR I-2361.
(21)
–	Judgment in Keck and Mithouard
(cited above in footnote 7, paragraph 16 et seq.).
(22)
–	Judgments in Keck and Mithouard (cited above in footnote 7, paragraph 13) and Joined Cases C-418/93 to C-421/93, C-460/93 to C-462/93, C-464/93, C-9/94, C-10/94, C-11/94, C-14/94, C-15/94, C-23/94, C-24/94 and C-332/94 Casa Uno and Others
[1996] ECR I-2975, paragraph 24.
(23)
–	Cited above in footnote 8, paragraph 22 (advertising of quasi-pharmaceutical products outside the pharmacy).
(24)
–	Cited above in footnote 9, paragraph 22 (prohibition on televised advertisements for distribution undertakings).
(25)
–	Cited above in footnote 10, paragraph 44 (outright ban on advertising aimed at children less than 12 years of age and on misleading advertising, as provided for by Swedish legislation).
(26)
–	Cited above in footnote 11, paragraphs 25 and 32.
(27)
–	Judgment in Keck and Mithouard
(cited above in footnote 7, paragraph 16).
(28)
–	Judgments in Yves Rocher
(cited above in footnote 20, paragraph 10) and Case C-470/93 Mars
[1995] ECR I-1923, paragraph 13.
(29)
–	OJ 2000 L 178, p. 1.
(30)
–	Bundesgesetz, mit dem bestimmte rechtliche Aspekte des elektronischen Geschäfts- und Rechtsverkehrs geregelt (E-Commerce-Gesetz – ECG) und das Signaturgesetz sowie die Zivilprozessordnung geändert werden, (Law governing certain legal aspects of electronic business and legal transactions (E-Commerce Law – ECG) and amending the Signature Law and Code of Civil Procedure) BGBl. I No 152/2001.
(31)
–	See the preamble to the Proposal for a European Parliament and Council Directive on certain legal aspects of electronic commerce in the internal market, COM(1998) 586 final of 18 November 1998, p. 9 et seq.
(32)
–	Cited above in footnote 11, paragraph 21.
(33)
–	Judgments in Case C-313/94 Graffione
[1996] ECR I-6039, paragraph 17, and Case C-3/99 Ruwet
[2000] ECR I-8749, paragraph 50.
(34)
–	Judgments in Ruwet
(cited above in footnote 33, paragraph 50) and De Agostini
(cited above in footnote 10, paragraph 46).
(35)
–	Judgment in Case C-260/89 ERT
[1991] ECR I-2925, paragraph 43 et seq. (on the freedom to provide services and the grounds of justification in Article 46 EC). See also to the same effect the judgment in Case C-368/95 Familiapress
[1997] ECR I-3689, paragraphs 26 to 28 (on the free movement of goods and the grounds of justification in Article 30 EC).
(36)
–	Eur. Court H. R., Markt Intern Verlag GmbH and Klaus Beermann judgment of 20 November 1989 (cited above in footnote 13), Series A no 165, § 25 et seq., and Casado Coca v. Spain judgment of 24 February 1994, Series A no 285, § 35 et seq.
(37)
–	Joined Opinion of Advocate General Fennelly of 15 June 2000 in Cases C-376/98 Germany v Parliament and Council
and C-74/99 Imperial Tobacco
[2000] ECR I-8419, paragraph 145.
(38)
–	Judgment in Markt Intern
(cited above in footnote 13, § 31).
(39)
–	Judgment in Casado Coca
(cited above in footnote 36, § 46).
(40)
–	Decision of 5 May 1979 in Case 7805/77, X and Church of Scientology v Sweden, Decisions and Reports
16 (1979), 68, 73. Frowein, in: Frowein/Peukert, European Convention on Human Rights
(1985), Article 10, Paragraph 9, with further references. Van Dijk/Van Hoof, Theory and practice of the European Convention on Human Rights (second edition), Article 10, Paragraph 8, p. 425.
(41)
–	Joined Opinion in Germany
v Parliament and Council
and Imperial Tobacco
(cited above in footnote 37, paragraph 159).
(42)
–	See the wording of the second part of the application for an interlocutory injunction, as reproduced in the order for reference.
(43)
–	Judgment in Yves Rocher
(cited above in footnote 20, paragraphs 16 to 18).
(44)
–	Judgment in Case 20/87 Gauchard
[1987] ECR 4879, paragraph 7, with further references.
(45)
–	Judgments in Case 238/82 Duphar
[1984] ECR 523, paragraph 25, Case 172/82 Inter-Huiles and Others [1983] ECR 555, paragraph 12, and Case C-209/98 Sydhavnens Sten & Grus [2000] ECR I-3743, paragraph 34.
(46)
–	Judgment in GB-INNO-BM
(cited above in footnote 12, paragraph 7 et seq.).
(47)
–	Judgment in Case C-275/92 Schindler
[1994] ECR I-1039, paragraphs 20 to 25.
(48)
–	Judgment in De Agostini
(cited above in footnote 10, paragraph 51).
(49)
–	Judgments in Case C-288/89 Collectieve Antennevoorziening Gouda and Others
[1991] ECR I-4007, paragraph 14, and in De Agostini (cited above in footnote 10, paragraph 53).