Opinion of Mr Advocate General Sir Gordon Slynn delivered on 2 June 1988. - Syndicat des libraires de Normandie v L'Aigle distribution. - Reference for a preliminary ruling: Tribunal de grande instance d'Alençon - France. - Fixed price for books. - Case 254/87.



European Court reports 1988 Page 04457



Opinion of the Advocate-General

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My Lords,

On 28 April 1987, the Syndicat des libraires de Normandie ( Normandy Booksellers' Association ) brought proceedings before the tribunal de grande instance, Alençon, against the Société l' Aigle distribution, centre Leclerc, Saint Sulpice sur Risle (" Aigle distribution ") for selling books at prices lower than those permitted by Article 1 of French Law No 81-766 of 10 August 1981, as amended by Law No 85-500 of 29 May 1985 . Those provisions require publishers and importers of books to fix a retail price for the books which they publish or import; they provide that ( subject to certain exceptions ) retailers must charge a retail selling price of between 95 and 100% of the price fixed by the publisher or importer . The fifth paragraph of Article 1 provides that where books initially published in France are re-imported, the selling price to the public fixed by the importer shall be at least equal to that which has been fixed by the publisher; after the judgment of the Court of Justice in Case 229/83 Association des centres distributeurs Edouard Leclerc v "Au blé vert" SARL (( 1985 )) ECR 1 (" Leclerc Books "), Law No 85-500 added a sixth paragraph to Article 1 whereby the provisions of the fifth paragraph are not applicable to books imported from a Member State of the EEC unless it is established, in particular by the absence of actual marketing in that State, that the object of the operation was to evade the provisions of the article restricting the retail price to the public to between 95 and 100% of the price fixed by the publisher or importer in respect of sales to the public .

Aigle distribution admitted the facts alleged, but argued before the national court that the French legislation was contrary to Community law; the national court accordingly referred the following questions to the Court of Justice for a preliminary ruling :

( 1 ) Does the fact that the freedom to fix prices is restricted to a single category of trader facilitate the establishment of captive or controlled distribution networks and therefore constitute an infringement of the combined provisions of Article 3 ( f ), 5 and 85 of the EEC Treaty or at the very least detract from their effectiveness?

( 2 ) Does the delegation of powers by French law to certain traders, namely publishers, infringe Article 86, and in the alternative Article 85, or at the very least detract from their effectiveness, by virtue of the fact that the selling price is fixed within a single trade in the light of economic principles which are not determined by competition or by the market?

Aigle distribution proposes an affirmative answer to both questions . The French Republic and the Commission both propose that the questions should be answered in the negative "in the present state of Community law ".

In Leclerc Books the Court ruled, in relation to Article 1 of Law No 81-766 in its original form, inter alia : "As Community law stands, the second paragraph of Article 5 of the EEC Treaty, in conjunction with Articles 3 ( f ) and 85, does not prohibit Member States from enacting legislation whereby the retail price of books must be fixed by the publisher or by the importer and is binding on all retailers, provided that such legislation is consonant with the other specific provisions of the Treaty, in particular those relating to the free movement of goods ".

That ruling was confirmed, in relation to Article 1 in its original form, in the judgment of the Court in Case 299/83 Leclerc v Syndicat des libraires de Loire-Océan (( 1985 )) ECR 2515 ( see also Case 95/84 Darras and Tostain, judgment of 10 July 1986 (( ECR 2253 )) ).

In Case 355/85 Cognet, judgment of 23 October 1986 (( ECR 3231 )), Article 1 in its amended form was challenged on the grounds of discrimination inasmuch as it allowed the prices of books published in France and re-imported from another Member State to be fixed freely by the importer whilst leaving the prices of books published in France and remaining in France subject to the price fixed by the publisher . The Court rejected that challenge, ruling : "Neither Article 7 of the EEC Treaty nor any other provision or principle of that Treaty applies to a difference of treatment under legislation which provides that the retail selling price of books is to be fixed by the publisher or the importer of a book, which is binding on all retailers and according to which the price of books published and printed in the Member State concerned may be freely determined where the books are re-imported after having first been exported to another Member State, whereas the price is fixed by the publisher where the books have not crossed a border within the Community in the course of being marketed ".

That ruling was confirmed by the Court in Case 168/86 Yvette Rousseau, judgment of 25 February 1987 (( ECR 995 )), and in Case 160/86 Verbrugge, judgment of 9 April 1987 (( ECR 1783 )).

In the present case the French legislation is challenged as being contrary to Articles 85 and/or 86 of the EEC Treaty inasmuch as it facilitates conduct by undertakings in breach of those articles . It is said that the legislation of a Member State can constitute an infringement of Articles 85 and/or 86, read in conjunction with Articles 3 ( f ) and 5 of the Treaty, where it sufficiently favours or enables anti-competitive conduct by undertakings . A consistent line of case-law of the Court establishes that, whilst Articles 85 and 86 are directed at undertakings, the Treaty imposes a duty on Member States not to adopt or maintain in force any measure which could deprive those provisions of their effectiveness : paragraph 31 of the judgment in Case 13/77 INNO v ATAB (( 1977 )) ECR 2115 at p . 2144; paragraph 71 of the judgment in Joined Cases 209 to 213/84 Ministère public v Asjes, judgment of 30 April 1986 (( ECR 1425 )); paragraph 10 of the judgment in Case 311/85 Vereniging van Vlaamse Reisbureaus v Sociale Dienst, judgment of 1 October 1987 (( ECR 3801 )); and paragraph 23 of the judgment in Case 136/86 BNIC v Aubert, judgment of 3 December 1987 (( ECR 4789 )). A Member State fails in that duty, in particular, where it requires or favours the adoption of agreements, decisions or concerted practices contrary to Article 85 and where it reinforces the effects thereof : paragraph 72 of Asjes and paragraph 10 of Vlaamse Reisbureaus .

There may also be force in the argument that the national legislation itself may not be contrary to Community law but may put into the hands of undertakings a power which they may abuse contrary to Community law, in particular Article 85 or Article 86, such as the statutory monopoly on delivering type approval certificates for motor vehicles at issue in Case 26/75 General Motors (( 1975 )) ECR 1367 and Case 226/84 British Leyland, judgment of 11 November 1986 (( ECR 3263 )). Whether undertakings had abused their statutory power contrary to Article 85 or Article 86 would be a question for the judge of fact to answer .

If, in the present case, it had been found as a fact that there had been conduct on the part of undertakings contrary to Articles 85 and/or 86 in relation to fixing French book prices and if it had been found as a fact that that behaviour was caused or facilitated by the national legislation in question, perhaps even not prevented or controlled by national legislation, there might be grounds for doubting the compatibility of such national legislation with Articles 3 ( f ), 5 and 85 or 86 of the EEC Treaty .

These are, however, matters of fact for the national judge . Both questions referred in the present case are based on a hypothesis of anti-competitive conduct by undertakings . The order making the reference does not find that captive or controlled distribution networks exist and, if so, whether they result from agreements or practices contravening Article 85 of the Treaty ( Question 1 ); nor does it find the existence of a dominant position or any abuse thereof contrary to Article 86 of the Treaty, or any agreement or concerted practice regarding price fixing contrary to Article 85 ( Question 2 ). Nor does the order for reference contain a finding that any such conduct is required, favoured or reinforced by the national legislation in question : there is no finding of causation by the legislation of the forbidden conduct .

It follows that the issue raised by the order for reference is in substance the same as that considered by the Court in relation to Articles 85 and 86 in Leclerc Books . Since no new relevant matters have been established, the Court' s reasoning in that case and its ruling particularly at point 1 of the operative part of the judgment continue to apply . In my opinion the questions referred for a preliminary ruling in this case fall to be answered in the terms of point 1 of the operative part of the Court' s ruling in Leclerc Books .

Accordingly in my opinion the questions referred for a preliminary ruling should be answered along the lines that :

"As Community law stands, the second paragraph of Article 5 of the EEC Treaty, in conjunction with Articles 3 ( f ) and 85 and 86, does not prohibit Member States from enacting legislation whereby the retail price of books must be fixed by the publisher or by the importer and is binding on all retailers, provided that such legislation is consonant with the other specific provisions of the Treaty, in particular those relating to the free movement of goods ."

The costs of the Commission and the French Government are not recoverable, the costs of the parties to the main action are a matter for the national court to decide .