OPINION OF ADVOCATE GENERAL

RUIZ-JARABO COLOMER

delivered on 24 May 2005 1( )

Case C‑147/04

De Groot en Slot Allium BV and

Bejo Zaden BV

v

Ministère de l’économie, des finances et de l’industrie and

Ministère de l’agriculture, de l’alimentation, de la pêche et des affaires rurales

(Reference for a preliminary ruling from the Conseil d’État (France))

(Free movement of agricultural goods – Quantitative restrictions – Measures having equivalent effect – National legislation permitting only bulbs produced by vegetative propagation to be marketed as ‘shallots’)

1. The Conseil d’État of the French Republic (‘the referring court’) has turned to the Court of Justice for clarification as to whether a Member State may prohibit the distribution in its territory under the name ‘shallot’ of plants of the species ( ) cultivated from seeds, not bulbs.

2. By way of Community provisions precluding such a prohibition, the referring court invokes Directives 70/458/EEC ( ) and 92/33/EEC ( ) which govern, respectively, the marketing of vegetable seed and vegetable propagating and other planting material. ( ) However, as well as analysing the directives, it is essential to broaden the perspective by taking into consideration the content of the EC Treaty, in order to provide the referring Court with a helpful answer.

I – Legislative framework

A – Community law

1. Primary law: the common market, the free movement of goods and agricultural products

3. The common market, which Article 2 EC seeks to establish, extends to agriculture and trade in agricultural products, ( ) the operation of that common market being facilitated by a common policy (Articles 3(1)(e) EC and 32(1) and (2) EC), one of the aims of which is to increase agricultural productivity by promoting technical progress and by ensuring the rational development of production (Article 33(1)(a) EC). Uniform action requires, in some cases, coordination of the various national market organisations (Article 34 (1)(b) EC).

4. The construction of that framework also requires the abolition, as between Member States, of obstacles to the free movement of goods (Article 3(1)(c) EC), including agricultural products (Article 32(1) and (2) EC). Quantitative restrictions and all measures having equivalent effect are therefore prohibited (Articles 28 EC and 29 EC) unless justified on the grounds stated in Article 30 EC, ( ) and must not, in any case, constitute a means of arbitrary discrimination or a disguised restriction on trade.

5. Under Article 37 EC, legislative power in this field lies with the Council, which acts on a proposal from the Commission and after consulting the European Parliament.

2. Secondary legislation: the marketing of plant reproduction material

6. Satisfactory results in vegetable cultivation depend to a large extent on the quality and plant health of the seeds, planting material and other material used for their propagation. Pursuant to Article 37 EC, the Council adopted Directives 70/458 and 92/33 in order to harmonise the conditions applying to the movement of propagation material by removing the barriers to the distribution of those plant materials brought about as a result of the disparities between the rules applying in the various Member States (second and fourth recitals in the preamble to both directives).

7. It was decided to create a common catalogue, in accordance with uniform rules, so that a variety listed therein is not subject to any trade restrictions (fifth, seventh, ninth and tenth recitals in the preamble to Directive 70/458, and Article 16 thereof; tenth and fifteenth recitals in the preamble to Directive 92/33, and Article 14 thereof).

8. However, Directives 70/458 and 92/33 differ in scope.

a) Directive 70/458

9. The scope of Directive 70/458 is defined by reference to the seeds of the plants listed in Article 2(1)(A) thereof – which does not refer to shallots ( ) – the varieties of which, once they have been officially accepted in at least one Member State, may be certified, ( ) checked as standard seed ( ) and marketed in the territory of the Community (Article 3(1)).

10. Each Member State is to establish one or more catalogues, ( ) on the basis of which a common catalogue is to be established, which is then to be published by the Commission (Articles 3(3) and 17).

11. In order to be entered in those catalogues, a variety must be distinct, stable and sufficiently uniform: it must differ markedly, in one or more important morphological or physiological characteristics, from any other variety accepted or submitted for acceptance; after successive multiplications or at the end of each cycle, it must remain true to the description of its essential characteristics; and, apart from a very few aberrations, the plants of which it is composed must, account being taken of the distinctive features of the reproductive systems of the plants, be similar or genetically identical (Articles 4 and 5). If a variety loses those characteristics, its acceptance must be revoked and the entry deleted (Articles 14(1) and 15(1)).

12. The Member States are to arrange for official publication of the catalogue of varieties accepted in their territory and to send notification to the other Member States and to the Commission of any alterations, together with a brief description of their characteristics in respect of use (Articles 10(1) and 11(1) and (2)).

13. Marketing restrictions on the catalogued seeds are to be avoided, although a Member State may, in accordance with the procedure laid down in Article 40 of the Directive, be authorised to prohibit the marketing of seeds of a variety which is not distinct, stable or sufficiently uniform (Article 16(1) and (2)).

14. As I have already pointed out, the Commission is to publish, under the title ‘Common Catalogue of Varieties of Vegetable Species’, a list of all varieties whose seed, pursuant to Article 16, is not to be subject to any marketing restrictions (Article 17).

15. A Member State may be authorised, pursuant to Article 40, to prohibit the sale of a variety entered in the common catalogue if its cultivation is harmful, from the point of view of plant health, to the cultivation of other species (Article 18).

16. Directive 70/458 was codified by Council Directive 2002/55/EC of 13 June 2002, ( ) which replaced it (keeping the same title). The new directive entered into force in August 2002 but does not apply in the present case, since the application before the referring court refers, as is explained below, to two varieties of seed entered in the 1997 common catalogue.

b) Directive 92/33

17. Directive 92/33 applies to the marketing, within the Community, of vegetable propagating and planting materials, ( ) other than seeds, belonging to the genera and species, and their hybrids, listed in Annex II (Article 1), which include the shallot.

18. Propagating material which belongs to plants listed in Annex II to Directive 92/33 and which is also covered by Directive 70/458 is to move freely within the Community if it belongs to a variety accepted in accordance with the latter Directive (Article 9(1) of Directive 92/33). In other cases, such as that of the shallot, marketing is to be conditional on official acceptance in at least one Member State, that acceptance to be in accordance with the requirements and procedures laid down in the Directive 70/458 (Article 9(2) of Directive 92/33). In both sets of circumstances, they are to be included in the common catalogue in accordance with the conditions, and with the consequent legal effects, specified in Articles 16 to 19 of Directive 70/458 (Article 9(4) of Directive 92/33). In particular, they are not to be subject to any trade restrictions other than those provided for in Directive 92/33 (Article 14 of Directive 92/33).

B – French law: the Order of 17 May 1990 ( )

19. This Order relates to in natura varieties intended for consumption (Article 2); it authorises use of the term ‘shallot’ only in respect of the fruit of the Allium cepa L. var ascalonicum produced by vegetative propagation, using bulbs with specific characteristics, and thus prohibits the sale, as ‘shallots’, of plants produced by other means.

20. Under Article 214-2 of the Consumer Code and Order No 55-1126 of 19 August 1955 implementing the Law of 1 August 1905 on the prevention of fraud in the marketing of fruit and vegetables, ( ) infringement of the provisions of the Order of 17 May 1990 is punishable as a criminal offence.

II – The facts, the main proceedings and the question referred for a preliminary ruling

21. The shallot is a liliaceous vegetable garden plant, traditionally cultivated by vegetative propagation, ( ) using bulbs. This method is employed above all in the French regions of Brittany and the Loire Valley.

22. The Dutch companies De Groot En Slot Allium BV and Bejo Zaden BV (‘De Groot and Bejo’) have developed two seed varieties of this tuber, called’Ambition’ and ‘Matador’, so that it can be produced generatively. On 29 June 1995, after the relevant tests, both varieties were entered, in accordance with Directive 70/458, in the Netherlands catalogue as derivatives of the species allium ascalonicum L. – Ecgalote, and notification of the entry, together with the description of the characteristics of the variety, was sent to the other Member States and to the Commission.

23. On 18 March 1997 the Commission published a supplement to the 19th complete edition of the common catalogue, including the ‘Ambition’ and ‘Matador’ varieties under the species name allium ascalonicum L, ( ) a situation which has remained unaltered in subsequent publications. ( ) Since that date, the varieties ‘Ambition’ and ‘Matador’ have been marketed as shallots in the Member States, with the exception of France, owing to the application of Ministerial Order of 17 May 1990.

24. Since 1999, De Groot and Bejo, whose main activity was the distribution of shallots for sale to the consumer, has concentrated on marketing seed, especially seed of the two varieties at issue.

25. During 2000 and 2001 two complaints were sent to the Commission concerning the free movement of these vegetables, but received no reply. The first complaint was from French and Dutch growers, protesting against the entry of those varieties in the common catalogue, and the second was from Dutch producers, claiming that the French order is incompatible with Community law.

26. On an unspecified date in 2001, ( ) De Groot and Bejo applied to the competent ministers for repeal of the Order, but met with silence. They therefore brought proceedings before the Conseil d’État, in which the Comité économique agricole régional ‘Fruits et légumes de la Région Bretagne’ (‘Cerafel’) has also intervened.

27. By order of 4 February 2004, the Conseil d’État asked the Court of Justice to clarify whether Directives 70/458 and 92/33 permit only varieties of shallot reproduced by vegetative propagation, without seed, to be included in the common catalogue, and to determine whether the ‘Matador’ and ‘Ambition’ varieties may be listed under the heading reserved for shallots.

III – Procedure before the Court of Justice

28. Written observations have been submitted, within the period laid down by Article 20 of the EC Statute of the Court of Justice, by the Commission, the French and Netherlands Governments, De Groot and Bejo (the applicants in the main proceedings) and Cerafel; their representatives presented oral argument at the hearing on 21 April 2005.

IV – Analysis of the question referred for a preliminary ruling

29. The question referred for a preliminary ruling arose in the context of proceedings for annulment – on the ground that it is contrary to Community law – of the order which governs, in France, the sale of shallots to the consumer without prior processing. Accordingly, it is necessary to undertake an analysis of two aspects which are closely related and which have been dealt with at length in some of the written observations: (i) the material scope of the Directives interpreted and (ii) the possibility that the body of legislation at issue might change, abandoning those texts and incorporating fundamental principles of primary law, such as the principle laid down in Article 28 EC, under which quantitative restrictions on imports and measures having an equivalent effect are prohibited.

A – The subject-matter of Directives 70/458 and 92/33

30. These Community acts apply to the material for vegetable production, the former to seeds, the latter to planting and other propagating material; on the other hand, the Order contested before the Conseil d’État concerns in natura plants prepared for sale, that is to say, the result of the reproductive process. In other words, the legislation to be compared does not have the same subject-matter: the Community legislation seeks to promote intra-Community trade, free of restriction, in the aforementioned reproductive material, whereas the Order concerns the distribution to the public in French territory of the resulting product.

31. Once that has been made clear, it is possible to respond quickly and coherently to the doubts expressed by the national court, by stating that the directives at issue do not apply in the case before the referring court, since they do not govern the marketing or appellation of the end product; in consequence, the Order of 17 May 1990 does not infringe Community law. That approach, which has been suggested by the Commission and also by De Groot and Bejo, is in keeping with both the letter and spirit of the law.

32. Directives 70/458 and 92/33 seek, in accordance with the objectives set out in Article 33(1)(a) EC, to increase productivity in vegetable cultivation by a particular means: control of the quality and plant health of the material used for their reproduction, so that only those which satisfy the conditions laid down move without restriction within the Community. For those purposes, a common catalogue has been established as a means of ensuring publicity and legal certainty.

33. Naturally, Community shallots are agricultural goods, which must not be subject to internal restrictions, but that requirement does not derive from the aforementioned directives, it is a pre-requisite for the common market as conceived in the EC Treaty, in particular in Articles 3(1)(c) and 32(1) and (2) thereof. ( )

34. In short, in order to settle the dispute, the Conseil d’État does not need to know whether the combined effect of Directive 70/458, which does not apply to shallots, and Directive 92/33, which does, is to prohibit the inclusion of seed varieties of that kind of liliaceous plant in the common catalogue, without guaranteeing their freedom of movement, since the Order on which it has to give a ruling does not govern propagation material but specimens which have been reproduced for sale to the consumer.

35. A ban on trade – under the name ‘shallot’ – in plants grown from seed has an indirect impact on the distribution of the seeds, and the marketing of those vegetables is adversely affected. However, that aspect falls to be addressed in the main proceedings. The Court of Justice must confine itself to providing the national court with guidelines for determining whether the national legislation is compatible with Community law, and for that purpose Directives 70/458 and 92/33 are irrelevant.

36. Yet the argument does not stop here. ( ) All agricultural products must be free to move without restriction, ( ) as laid down in Article 28 EC, with the exception only of restrictions justified on one of the grounds specified in Article 30 EC; for those purposes, it is a matter of no importance whether the particular product concerned is the vegetable, more or less prepared and ready for consumption, or the plant material from which the vegetable is obtained. ( )

B – Application of Article 28 EC

1. A measure having equivalent effect to a quantitative restriction

37. The French Government relies on the judgment in DaimlerChrysler ( ) in order to maintain that, when the regulation of a particular field has been harmonised, it must be assessed in the light of secondary legislation, not in the light of the provisions of the Treaty. However, that argument has a serious weakness, in that Directives 70/458 and 92/33 concern propagation material, and do not cover shallots, regarded as an end product. There is therefore no reason why the Court of Justice should not express its opinion in the light of the EC Treaty.

38. Since the judgment of 11 July 1974 in Dassonville ( ) which coined a formula later to be described as ‘famous’, ( ) it has been acknowledged that Article 28 EC prohibits any rule capable of hindering, directly or indirectly, actually or potentially, trade between the Member States, and that such a rule is to be regarded as a measure equivalent in effect to a quantitative restriction (paragraph 5).

39. Legislation which treats domestic products differently from imported products constitutes such a measure, and is permissible only if justified by reference to one of the public-interest exceptions set out in Article 30 EC. ( )

40. Measures which, although treating imported products and domestic products alike, make it more difficult for the former to enter the market, also fall into that category. ( ) That type of situation arises frequently in uncoordinated sectors, in which existing differences create obstacles to freedom of movement from one Member State to another. ( ) However, such obstacles are justified if they pursue one of the objectives set out in Article 30 EC or if they are necessary for effective fiscal supervision, the protection of public health, the fairness of commercial transactions or consumer protection. ( )

41. The case-law established in Dassonville, which has been re-stated on many occasions, sometimes in relation to food products, ( ) has been applied in cases where the facts are similar to those in the case before the referring court, and provides useful guidelines for deciding that dispute.

42. Miro ( ) established that Article 30 of the EC Treaty (now, following amendment, Article 28 EC) precludes national legislation which requires a spirituous beverage, in order to be sold as gin, to have a pre-fixed alcohol content, and prohibits the marketing under the same appellation of such beverages imported from another Member State if they do not have the minimum fixed alcohol content, even though the beverage is a traditional drink in the country of origin, and the purchaser is provided with proper information. In Deserbais( ), the Court ruled to the same effect in respect of Edam cheeses.

43. In Smanor, cited above, it was held that the aforementioned provision does not permit prohibition of the use of the name ‘yoghurt’ in the case of deep-frozen yoghurt which is lawfully marketed in other Member States, when the characteristics of the latter product are not substantially different from those of the fresh product. In Commission v France( ), the Court found that France had infringed Article 28 EC by prohibiting the marketing as ‘foie-gras’ of foie-gras manufactured in another Member State in accordance with rules and procedures different from the requirements of French legislation. In Guimont ( ), the provision was construed as precluding a Member State (France again) from prohibiting the use, within its borders, of the designation ‘Emmenthal cheese’ for cheeses lawfully manufactured without rind in the Community. Spain and Italy also infringed Article 28 EC – according to judgments against them, both dated 16 January 2003 ( ) – by prohibiting the marketing, as ‘chocolate’, of products known by that name in other Member States.

44. The position is similar in the present case, ( ) because the prohibition against the marketing, as ‘shallots’, of vegetables grown from seed affects not only those cultivated in France but also those grown elsewhere. As in the cases cited ( ) and in other similar cases, ( ) it seems that the prohibition, because it affects shallots cultivated in other Member States, constitutes an obstacle to their importation: in so far as it entails an obligation to market shallots grown from seed under another name, which is either unknown to consumers, or less highly regarded by them, its is likely to make the marketing of those products difficult, thus directly impeding trade between Member States. ( )

45. It is therefore necessary to consider whether the provisions of the French Order are justified on the basis of one of the exceptions set out in the ‘Cassis de Dijon’ judgment. The order for reference and the observations presented in these proceedings do not clarify the point; the French Government and Cerafel are silent on the matter. However, a clue is provided in the preamble to the Order of 17 May 1990 by the reference to the rules on fraud and forgery concerning products and services. That reference suggests two possibilities: protection of commercial property and consumer protection. ( ) The former must remain outside the bounds of any investigation in the present case because, as I pointed out in point 65 of my Opinion of 10 May 2005 in the ‘Feta II’ cases, ( ) the exceptions provided for in Article 30 EC fall to be narrowly construed, and must not be extended to cover circumstances other than those delimited, and it is common ground that the name ‘shallot’ does not represent any manifestation of that special form of property. ( )

2. Consumer protection

46. This reason for restricting the movement of goods makes it possible for the user to be properly informed about them, so that his choice is not based on a misapprehension. ( )

47. For the purposes of informing the purchaser, appropriate labelling is often sufficient ( ) to show that, although the foodstuffs on sale have the same name, they are not identical. This is consistent with the principle of proportionality. ( )

48. However, if the difference between the products is significant, Smanor (paragraph 21) and Deserbais (in an obiter dictum in paragraph 13) ( ) authorise Member States to require the description of an imported foodstuff to be altered, provided that the product, in terms of its composition or production, is so different from the products generally understood as falling within that description within the Community that it may be regarded as falling within a different category.

49. On this point is not easy to give an answer. First, nobody disputes that traditional shallots and shallots grown from seed are outwardly similar, although, once they have been opened, they are significantly different, since only the latter look like onions. Furthermore, the production process runs along different lines, since the former are propagated vegetatively by means of bulbs, which are replanted and generate their own progeny, whereas the latter are reproduced generatively, by sowing seeds, and the final fruit does not create new individual plants. However, in spite of the different propagation procedures, it should not be forgotten that, from a taxonomic point of view, both varieties belong to the same species (allium ascalonicum L.).

50. Shallots grown from seed have appeared on the market recently, and their impact on the total volume of shallots grown in the Community is very small. This is explained by the fact that in France, the leading producer in the European Union (90% of the total), the vegetative method is usually used, because France is the country in which – precisely because the Order of 17 May 1990 is in force – shallots cultivated generatively are not called ‘shallots’, although they are marketed under that name in other Member States, such as the Netherlands. ( )

51. The most appropriate approach is suggested by the Commission in its written observations, in which, without offering any proposal as to how to answer the question referred for a preliminary ruling, the Commission calls for a legislative initiative designed to harmonise the naming of products, with the name ‘seed shallots’ reserved for shallots reproduced from seed; however, until that scheme materialises, the Court of Justice must provide the Conseil d’État with the relevant criteria for settling the dispute in the main proceedings.

52. In those circumstances and in light of the fact that the objective pursued by the French authorities may be attained by properly informing the purchaser, through appropriate labelling, that the vegetable he is buying has been cultivated from seed, I suggest that the Court of Justice confirm to the national court that Article 28 EC precludes national legislation such as that on which it is called to give a ruling, which creates an obstacle that is unnecessary and, as is clear from the fact that it is protected by criminal penalties, disproportionate.

V – Conclusion

53. In the light of the foregoing considerations, I propose that the Court of Justice give the following reply to the French Conseil d’État:

‘1. Council Directive 70/458/EEC of 29 September 1970 on the marketing of vegetable seed and Council Directive 92/33/EEC of 28 April 1992 on the marketing of vegetable propagating and planting material, other than seed, do not apply in circumstances such as those of the case before the referring court.

2. Article 28 EC precludes national legislation which reserves the right to use the name ‘shallot’ to shallots cultivated by means of vegetative propagation, to the exclusion of those grown from seed, even though the latter are produced and marketed lawfully under that name in other Member States and appropriate labelling is sufficient to ensure that the consumer receives proper information regarding the different means of reproduction.’