4.

The main contention of the Belgian Government is that the protection of health requires the holder of the approval to be established in Belgium because he is the person who incurs liability, including criminal liability, in connection with the marketing of the product. If criminal penalties are to be effective the person to whom they apply must be established in the country in which they are imposed. The Belgian Government must therefore establish three propositions: 1. Criminal penalties are necessary for the protection of public health; 2. To be effective those penalties must apply to a person established in Belgium; 3. To be effective the penalties must apply only to the holders of the approval or the authorization. In the opinion of the defendant government, the protection of public health requires that the infringement of rules relating to the marketing of the products in question be subject to criminal penalties. Such penalties are not only punitive in nature, but also have a deterrent effect on persons who may be tempted to bring on to the market goods which do not conform to the requirements. Moreover, to be effective the criminal penalties imposed by the courts must be enforceable against persons established in Belgium. In the present state of affairs, international agreements relating to cooperation in matters of criminal law (extradition, exchange of information and the enforcement of criminal judgments) are ineffective; prison sentences are completely unenforceable, as, indeed, are fines when the person convicted has no property in Belgium. The Commission does not seriously dispute the first two elements of the Belgian Government's argument. It expresses some doubt as to whether punitive action has in practice the effects attributed to it by the Belgian Government, but it does not formally contest the necessity thereof or, ultimately, the relative ineffectiveness of criminal judgments in relation to persons established abroad. In that respect it should be emphasized that, although I share the view taken by both the parties, criminal penalties, that is to say in practice usually fines, have in my opinion much less deterrent value than administrative sanctions such as the temporary or permanent prohibition of carrying out independent activities in the sector of the products concerned. The essential question in this dispute is, therefore, whether it is necessary, in order for criminal penalties to be effective, that they be enforceable against the holder of the authorization alone. The Belgian Government takes the view that it is logical to hold only the person who applies for authorization liable for the accuracy of the authorization documents and for the conformity of the product marketed with the registered formula and the provisions relating to packaging and labelling. If the persons offering the product for sale on national territory were held liable, that would weaken the liability and reduce the effectiveness of the legislation. If several persons were liable, they would doubtless try to escape liability by attempting to put it on each other. In addition they would be expected to have the same knowledge of all the details in the authorization documents as the holder. To make such an obligation effective it would be necessary to introduce a system at least as restrictive as the present one. Finally, the inspections would be much less effective in view of the fact that it cannot reasonably be suggested that they be carried out in respect of all potential buyers of the products. That line of argument does not seem to me to be wholly successful. It may be noted that the most dangerous products (those included in lists A, B and C in the annex to the disputed Royal Decree) “may not be imported, purchased or stocked for sale, offered for sale, sold or transferred free of charge except by persons duly authorized by the minister with responsibility for public health and recognized as approved dealers”. It would seem therefore that criminal proceedings for the offering for sale of goods which do not satisfy the requirements may be brought just as easily against those persons as against the holders of the authorization. Again, it may be thought that the withdrawal of their approved status would have a greater deterrent value than the imposition of a fine. The same argument applies to those products which must not be sold by approved dealers. It is difficult to appreciate why the effectiveness of the Belgian system of criminal law enforcement would be lessened, since nothing prevents criminal liability from being imposed on the importer or the dealer or, if necessary, on both, as both of them are necessarily established in Belgium. Consequently I consider that the requirement that the person applying for approval or authorization for the marketing of pharmaceutical products or pesticides be established in Belgium amounts to a restriction on imports into that country which is not justified on the ground of the protection of public health within the meaning of the first sentence of Article 36 of the Treaty.