61980C0056
OPINION OF MR ADVOCATE GENERAL CAPOTORTI
DELIVERED ON 16 DECEMBER 1980TRANSLATED FROM THE ITALIAN.
Mr President,
Members of the Court,
1.
This request for a preliminary ruling calls for an interpretation of certain provisions of Council Regulation No 355/79 of 5 February 1979 which laid down “general rules for the description and presentation of wines and grape musts”. The first matter to be established is the scope of the prohibition whereby persons who hold such products for sale or place them on the market are forbidden to describe or present them in a manner liable to cause confusion or to give customers a false impression as to their characteristics, in particular with regard to their geographical origin. The next matter to be ascertained is whether xhe relevant Community provisions permit the application of other, and more stringent, national provisions.
I shall briefly summarize the facts.
Firma Weigand, which trades in wines in the Federal Republic of Germany, offers for sale inter alia two “quality wines produced in specific regions” (quality wines psr) under the names “Klosterdoktor” and “Schloßdoktor”, which appear on the labels and are used in advertising in conjunction with a statement of the district of origin. However the Schutzverband Deutscher Wein, a German organization whose objectives include that of taking steps against unfair competition in the wine industry, maintains that the above-mentioned names are misleading since although they are merely imaginary names they create the impression that they relate to vineyards. In fact, the word “Doktor” forms part of the name of certain German wines, including the very famous “Bernkasteier Doktor”, whilst the words “Schloß” and “Kloster” are the names of certain vineyards and form part of the names of others. On the basis of those facts the Schutzverband Deutscher Wein instituted proceedings against Weigand before the Landgericht [Regional Court] Mannheim in which it sought an injunction against Weigand from marketing or advertising both “Klosterdoktor” and “Schloßdoktor” wines.
The court of first instance dismissed the proceedings; however the appellate court, the Oberlandesgericht [Higher Regional Court] Karlsruhe, allowed an appeal and, pursuant to Article 3 of the “Gesetz gegen den unlauteren Wettbewerb” [German Law on unfair competition], it prohibited the defendant from selling and advertising wine under the names in question. Weigand then appealed against that decision to the Bundesgerichtshof [Federal Court of Justice]. By an order of 19 December 1979 the Bundesgerichtshof stayed the proceedings in order to submit the following questions to the Court of Justice for a preliminary ruling under Article 177 of the EEC Treaty:
“1.
Must the word ‘confusion’ in Article 43 (1) of Regulation (EEC) No 355/79 of 5 February 1979 (Official Journal L 54, p. 99 et seq.) and/or the words ‘misleading information’ in Articles 8 (c) and 18 (c) of the regulation, as distinct from the words ‘false impression’ in Article 43 (2) of the regulation, be interpreted as covering only cases in which
(a)
purchasers may confuse a brand name with another specific brand name or description (in the present case, a description of a small locality (‘Lage’)) or
(b)
are confusing descriptions or misleading information to be understood as covering descriptions or information which induce the public to believe that what is being represented is the name, or part of the name, of a wine-growing local administrative area (‘Weinbauort’), which does not in fact exist, or of a small wine-growing locality (‘Weinbaulage’), which does not in fact exist?
2.
If Question 1 (b) is answered in the affirmative:
(a)
May a description and presentation (in this case, labelling) which is not objectionable under Article 43 (1) none the less come within the scope of Article 43 (2), or does Article 43 (1) provide comprehensive rules for the description of products?
(b)
Does Article 43 of the regulation permit the application of national legislation having wider scope, for example, Article 3 UWG (Gesetz gegen den unlauteren Wettbewerb [Law against unfair competition]), in a case where consumers may be misled by a description which, whilst it cannot be confused with the name of an actually existing small locality, may give the impression of being the name of a small locality?”.
2.
The German court has thus specifically referred to four provisions of Regulation No 355/79: Article 8 (c), Article 18 (c) and both paragraphs of Article 43. Articles 8 and 18 both concern brand names used for the description of wines and included on the labels of the bottles. Their content is to a large extent identical, the principal difference residing in the fact that Article 8 applies to table wines and Article 18 to quality wines produced in specified regions. Accordingly in this case it is sufficient to have regard to the latter provision only. In any event paragraph (c) of both Article 8 and Article 18 prohibits the use of brand names containing words, parts of words, signs or illustrations which contain false or misleading information, particularly in respect of geographical origin, wine variety, vintage year or superior quality.
With regard to Article 43, it places restrictions on the description and presentation of wine products, effected by means of labelling (paragraph (1)) and advertising (paragraph (2)), with the objective of ensuring that no confusion is caused (paragraph (1)) and no false impressions are created (paragraph (2)) with regard to the characteristics of any product. More particularly, Article 43 (1) stipulates that “the description and presentation of the products referred to in Article 1 (3)”, (that is, products held for sale or placed on the market) “including any form of advertising, must not be liable to cause confusion as to the nature, origin and composition of the product; this shall apply to the information referred to in Article 2, 12, 27, 28 and 29” (that is, the mandatory, or merely permitted, information appearing on the labels of table wines, quality wines produced in specified regions and those originating in non-member countries), paragraph 2 then provides that “the description and presentation in advertising material must be such as not to create a false impression of the product in question” particularly as regards a series of characteristics, including the type of product, the origin, quality, vine variety as well as other characteristics which are irrelevant to this case.
Comparison of the two paragraphs in question shows that the scope of the second differs in part from that of the first. The first is in fact intended to avoid the risk of confusion arising from the information on the labels and covers the use of such information in advertising whereas the second paragraph is intended to prevent a false impression as to the product being created by advertising material in general, including cases where media are used other than the information on the labels (such as descriptions, images, illustrations etc.).
Finally, Article 43 (1) should be compared with Article 18 (c). In the interests of authenticity and clarity, both provisions prescribe limits in regard to labelling but whilst Article 18 is concerned only with brand names Article 43 (1) covers all the information appearing on labels. The cases of confusion envisaged in the said articles also coincide only in part; it should be noted however that confusion as to the origin of the product is covered in both cases.
3.
I shall now consider the interpretations to be placed upon the expressions “confusion” and “misleading information” which appear in Article 43 (1), Article 8 (c) and Article 18 (c) respectively of the said Regulation No 355/79 and which the court making the reference regards as distinct from the expression “to create a false impression” employed in Article 43 (2). The alternatives are as follows: does “confusion” arise only if there is a risk that the brand name may be mistaken for another specific brand name or specific name of a locality or does it also arise if the brand name leads people to believe that it refers to a wine-producing locality, which in fact does not exist?
In my view the word “confusion” must be construed widely, and furthermore, the expressions “to cause confusion” and “to create a false impression” must be considered equivalent. The interpretation which I favour is based first of all on the wording: “to cause confusion as to the nature, origin and composition” of the wine. Article 43 (1) means to hinder the acquisition of accurate knowledge of those characteristics of the product by arousing doubt as to whether they may be other than they really are, but that does not necessarily mean that another specific nature, another specific origin or another specific composition have been described or presented. If that were so, it would be more accurate to speak of a passing-off. In this connexion it is noteworthy that in the said Article 8 (c) and in Article 18 (c) two different cases are mentioned as alternatives, namely where the information contained on the label is false or misleading. I would add that where the Community legislature referred to instances of confusion with something specific it did so clearly. Thus in Article 8 (b) and Article 18 (b) reference in made to the risk of confusion with the description of another kind of wine (as also in Article 31 (1) (c): confusion “with information used to describe a quality wine psr, table wine or another imported wine”; and in Article 34 (b) “confusion with the description of a table wine, a quality wine psr or an imported wine ... or with an illustration used to distinguish one of these wines”). None of those details is contained in Article 43 (1) and it thus appears to me unwarrantable to twist the wording in order to read into it “confusion with another specific brand name or another specific production locality”. I would observe finally that the aim of avoiding confusion between one brand name and another is proper to the rules directed against unfair competition or towards the protection of trade-marks, whilst Regulation No 355/79 is intended to protect consumers and to facilitate the inspection of wine products by public authorities.
In this connexion regard must be had to the assistance in interpreting the regulation in question which may be derived from its preamble. In the second recital in that preamble it is stated that “the purpose in any description and presentation should be to supply potential buyers and public bodies responsible for organizing and supervising the marketing of the products concerned with information which is sufficiently clear and accurate to enable them to form an opinion of the products” and that “rules should therefore be drawn up to ensure that this purpose is served”. In the third recital it is then emphasized, with particular reference to the description, that “in view of the importance and scope of the problem, steps should be taken to ensure that the information provided is as complete as possible ...”. There can thus be no doubt as to the objectives pursued by the provisions in question.
That having been said, the relationship between the two paragraphs of Article 43 must be understood in the light of these objectives. The protection of buyers, whereby it is sought that they should be able to form an opinion of the products, cannot be adequately attained unless the meaning given to the word “confusion”, which is employed in the first paragraph, coincides with that given to the expression “false impression”, which is contained in the second paragraph. If in fact the word “confusion” were narrowly construed it might be possible for a given label to be lawful under paragraph (1) — assuming that the imaginary name incorporated in the label does not cause confusion with another specific brand name or wine-producing locality — although it would be at variance with paragraph (2) in so far as it creates misunderstanding as to the origin of the product. Rules of this nature would be contradictory and would not meet the requirement of protecting the consumer. That requirement in fact arises in the same way both with regard to the information provided on the label and as respects the various forms of advertising used to increase the standing and sales of the product. The logical relation between the two paragraphs of Article 43 accordingly dictates that the expressions “to cause confusion” and “to create a false impression” must be recognized as bearing substantially the same meaning.
It appears to me that no material assistance is to be obtained from a comparison of the versions in the various languages of the regulation. Even if it were shown that the expression “to create a false impression” bears a consistently wider meaning than “to cause confusion” — as appears to be the case in the German version — that does not suffice to establish that “confusion” is necessarily to be understood as “confusion with another brand name or specific locality”. In addition it must not be forgotten that the question submitted by the German court concerns the exact meaning of the expression “contain misleading information” which, in Articles 8 (c) and 18 (c), is not set against the expression “create a false impression”.
4.
Turning now to the second group of questions I must first of all point out that, according to the wording of the order, the national court has framed them in case an affirmative answer is given to Question 1 (b). However the Commission and all the other parties talcing part in this case have rightly observed that the German -court has certainly committed an error since there is no point in putting the second group of questions unless a negative reply is given to Question 1 (b) and not the reverse. It is in fact clear that to ask the question — as Question 2 (a) in fact does — “may a description and presentation ... which is not objectionable under Article 43 (1) none the less come within the scope of Article 43 (2)” entails taking the view that the scope of Article 43 (1) is more limited than that of Article 43 (2) (that is, it would prohibit only confusion with specific brand names or production localities) and that view corresponds to a negative reply to Question 1 (b). For that reason the phrase introducing the second group of questions should be amended by substituting the word “negative” for the word “affirmative”.
Now that those points have been disposed of it is clear that the affirmative answer which I have suggested should be given to Question 1 (b) renders it unnecessary to consider Question 2 (a).
On the other hand I think that different reasoning applies in regard to Question 2 (b). This question too is in fact in the alternative (as that has been explained above) and accordingly there is no formal need to express an opinion on it. Nevertheless I consider that the general outlines of the problem should be considered. The problem is the relationship between the Community rules set out in Article 8 (c), Article 18 (c) and Article 43 of Regulation No 355/79 and any national rules which deal with “confusion” caused to consumers from the point of view of unfair competition. In fact these problems are independent of the first group of questions and are undoubtedly relevant for the national court which is required to decide in the present case whether, and if so to what degree, German legislation on unfair competition is applicable in addition to the said regulation.
In my view the description and presentation of wines and grape musts is governed exhaustively and completely by Regulation No 355/79 and the relative implementing provisions (contained in Commission Regulation No 1608/76). That those rules are self-contained is clearly apparent from Article 54 (1) of Council Regulation No 337/79 on the common organization of the market in wine, the first subparagraph of which requires the Council to adopt “as necessary” the rules relating to the designation and presentation of the products covered by the above-mentioned organization of the market, and the second subparagraph of which provides that “until entry into force of the rules referred to in the first subparagraph, the rules on this matter shall be those adopted by the Member States”. From those provisions it follows that once the Community rules have entered into force (which occurred, at any rate for wines and grape musts, with the promulgation of Regulation No 355/79), those rules preclude further application of national provisions in the same field unless permitted in regard to specific points by particular Community provisions. In fact there are many provisions of that nature in the regulation in question: I would cite as examples the second subparagraph of Article 1 (3); Article 2 (2) (h) and Article 2 (3) (d) (g) and (i); Article 3 (2) and the second subparagraph of Article 3 (3), Article 3 (4) and the second subparagraph of Article 3 (5); Article 4 (2); Article 5 (2); Article 6 (2); Article 11 (3) etc.
It must be stated that in this field the provision which has the greatest bearing on the present case is Article 13 (2), according to which “in the case of quality wines psr obtained on their territory, Member States may make compulsory, dispense with or restrict the use of certain particulars referred to in Article 12 (2) ...”. I should point out that Article 12 (2) lists the information which may be, but need not be, included on the labelling of quality wines psr, which information may embrace a brand name (Article 12 (2) (c)). Is it possible to interpret that provision as meaning that national legislation may restrict the use of a brand name by prohibiting names which are capable of misleading the consumer as to the geographical origin or other characteristics of the product? I think that the reply must be in the negative since that aspect of the description and presentation of products is expressly and exhaustively governed by Articles 18 and 43 of the Regulation No 355/79, to which the power to derogate conferred by the said Article 13 (2) may not be extended.
Nevertheless recognition of the complete and, in principle, exclusive character of the Community rules on the description and presentation of wine products does not entail rejection of the possibility of the continuing applicability of national provisions which, whilst impinging upon these rules, pursue objectives which are different from and compatible with (or even complementary to) the particular objectives of the rules in question. In my view that is the case with national provisions intended to prevent and suppress unfair competition. In fact I have already had occasion to note that the objectives of Regulation No 355/79 consist essentially in protecting consumers of wines and grape musts — by furnishing them with sufficient and truthful information on the products which they wish to buy — and in facilitating execution by the authorities of their duties of organization and supervision. On the other hand domestic rules regarding unfair competition are concerned principally with the protection of traders and only indirectly with consumers. I should add that at the points at which the above-mentioned regulation is concerned with the matter of the “confusion” caused by the use of distinctive signs for a product (as in the said Article 43), and thus deals with a problem displaying aspects relating to unfair competition (or perhaps aspects relating to a brand name), it is not only the case that different groups of provisions overlap but that the Community provisions prove to consist only of “substantive” rules whilst the domestic law on unfair competition (like that on brand names) also includes appropriate procedural arrangements and prescribes sanctions in the event of unlawful conduct. It would thus be inconceivable were Regulation No 355/79 to be interpreted, by reason of the fact that it is “complete” in the matter of description and presentation of wines, as being exclusive also as respects domestic rules on unfair competition and brand names. What is necessary, and indeed sufficient, is that no provisions on unfair competition or on brand names should be applied whose content constitutes an amendment (whether more or less stringent it matters not) of the provisions of that regulation.
These considerations are in line with the reasoning which I pursued in Case 50/76 Amsterdam Bulb [1977] ECR 137. I acknowledged then that the Member States may not adopt provisions intended to change the scope of Community regulations or to supplement them and in that connexion I cited the judgments of the Court of 18 February 1970 in Case 40/69 Hauptzollamt Hamburg v Bollmann [1970] ECR 69 and of 18 June 1970 in Case 74/69, Hauptzollamt Bremen v Krohn [1970] ECR 451. However I also stated that “this view was adopted in relation to cases where the government provision in question had the effect of interpreting the Community regulation and in consequence modified its scope: the underlying reason for the Court's decision was an intention to exclude anything which might modify or compromise the scope or rather the substance of a Community measure. It cannot, however, be said that a penal sanction changes the substance of the provisions of the regulation ... the fact that, for the purposes of [ensuring that Community regulations are observed], a State supplements Community legislation by penal sanctions does not conflict with the principles of the law of the European Communities”. The Court followed that point of view and held inter alia that “in the absence of any provision in the Community rules providing for specific sanctions to be imposed on individuals for a failure to observe those rules, the Member States are competent to adopt such sanctions as appear to them to be appropriate” (judgment of 2 February 1977 in the said case of Amsterdam Bulb [1977] ECR 137 at p. 151).
Turning to the present case I consider that in the situation described above, where Community provisions and national provisions overlap, the principle to which to adhere is that of the priority of the Community rules, from which it follows that national law is applicable only in so far as it supplements, or is compatible with, Community law. In the field of unfair competition it can accordingly be stated, in my view, that it is permissible to apply those internal rules which do not jeopardize due observance of Articles 8, 18 and 43 (or others) of the said Regulation No 355/79 and which, as respects procedures and sanctions, contribute to ensuring observance of those provisions.
5.
In conclusion I am of the opinion that the Court of Justice should provide the following reply to the questions submitted to it by the Bundesgerichtshof by its order of 19 December 1979:
1.
The expressions “confusion as to the nature, origin and composition of the product” contained in Article 43 (1) of Council Regulation No 355/79 of 5 February 1979 and “misleading information” referred to in Article 8 (c) and Article 18 (c) of the same regulation also cover the case of names of wines which may lead purchasers to believe that a geographical locality is thereby indicated, that locality not being in existence.
2.
Council Regulation No 355/79 constitutes, together with the implementing provisions contained in Regulation No 1608/76 of the Commission, a complete system governing the description and presentation of the wines and grape musts to which it applies. Accordingly, any national provisions in that sphere are applicable only in the cases expressly provided for in the Community rules. Nevertheless, the need to secure full and prior observance of Articles 8 (c), 18 (c) and 43 of the said Regulation No 355/79 does not preclude the application of those national provisions on unfair competition which are compatible with the Community rules and, in particular, of those which are procedural in their nature or have the function of laying down sanctions.
(
1
)	Translated from the Italian.