Action brought on 20 January 2003 by the EFTA Surveillance Authority against the Republic of Iceland (Case E-1/03)
Date: 2003-01-20
Institutions: EFTA Surveillance Authority
Subjects: EFTA, Iceland, action for failure to fulfil an obligation, air transport, airline, discrimination on the basis of nationality, freedom to provide services

27.3.2003

EN

Official Journal of the European Union

C 75/13

Action brought on 20 January 2003 by the EFTA Surveillance Authority against the Republic of
Iceland

(Case E-1/03)

(2003/C 75/13)

An action against the Republic of Iceland was brought before
the EFTA Court on 20 January 2003 by the EFTA Surveillance
represented by Niels Fenger and Elisabethann
Authority,
Wright, acting as Agents of the EFTA Surveillance Authority,
Rue de Trèves/Trierstraat 74, B-1040 Brussels.

The applicant claims that the Court should:

Infrastructure Budget and Revenues

1. Declare that by maintaining in force the Icelandic Act on
Air Transport
for
Aviation Affairs No 31/1987 (Lög nr. 31 frá 27. mars
framkvæmda í
1987 um flugmálaáætlun og fjáröflun til
flugmálum), which subjects flights from Iceland to other
EEA States to a higher tax rate than that charged for
domestic flights and flights to Greenland and the Faroe
Islands, the Republic of Iceland has failed to respect its
the Agreement on the
obligations under Article 36 of
European Economic Area and Article 3(1) of Council Regu-
lation (EEC) No 2408/92 of 23 July 1992 on access for
Community air carriers to intra-Community air routes; and

2. Order the Republic of

Iceland to pay the costs of

the

proceedings.

Legal and factual background and pleas in law adduced in support:

— Article 36 of the EEA Agreement requires the abolition of
all restrictions on the provision of services within the EEA
in respect of nationals of EC Member States and EFTA
States who are established in an EC Member State or an
EFTA State other than that of the person for whom the
services are intended.

— Article 38 of the EEA Agreement states that the freedom to
provide services in the field of transport shall be governed
by the provisions of Chapter 6 of the Agreement governing
transport. Article 39 of the EEA Agreement provides that
Articles 30, 32-34 shall also apply to the freedom to
provide services.

— Article 49 of the EC Treaty, which corresponds to Article
36 of
the EEA Agreement, excludes the application of
national provisions that, without objective justification,
restrict a service provider from exercising the freedom for
which that Article provides. Moreover, Article 49 of the EC
Treaty excludes the application of a national provision that
makes the provision of services between Member States
more difficult than the provision of services exclusively
within a single Member State.

— According to the Court of

Justice of

the European
Communities, Article 49 of the EC Treaty requires not
only the elimination of all discrimination against a person
providing services on the ground of his nationality, but also
the abolition of any restriction, including a charge set by
law for the performance of a service connected to a
transport service.

— According to the Court of

the European
Justice of
Communities,
the purpose of Council Regulation (EEC)
No 2408/92 of 23 July 1992 on access for Community
air carriers to intra-Community air routes is, inter alia, to
define the conditions for applying in the air transport
sector the principle of the freedom to provide services,
and to eliminate, with regard to air travel, restrictions on
the freedom to provide services within the framework of
the common transport policy.

Budget

Infrastructure

and Revenues

— According to a translation of the Icelandic Act on Air
Transport
for
Aviation Affairs No 31/1987 (Lög nr. 31 frá 27. mars
1987 um flugmálaáætlun og fjáröflun til framkvæmda í
flugmálum), Article 5(1), as amended, provides that
‘a
separate airport tax shall be paid in respect of each indi-
vidual travelling by aircraft from Iceland to other countries;’
Article 6(1) provides that ‘the airport tax shall amount to
ISK 1 250 for each passenger travelling from Iceland to
other countries;’ and, Article 7(1) provides that ‘airlines
engaged in the transport of passengers within Iceland or
to the Faroe Islands or Greenland shall pay a tax amounting
to ISK 165 for each passenger travelling on these routes.’