Case C-205/06: Action brought on  5 May 2006  — Commission of the European Communities v Republic of Austria
Date: 2006-07-15
Institutions: Court of Justice
Subjects: Austria, European Commission, action for failure to fulfil an obligation, approximation of laws, bilateral agreement, free movement of capital, investment, third country

15.7.2006

EN

Official Journal of the European Union

C 165/17

Form of order sought

Pleas in law and main arguments

— Declare that, by requiring that a parallel

imported plant
protection product and a reference product have a common
origin, the French Republic has failed to fulfil its obligations
under Article 28 EC;

— order the French Republic to pay the costs.

Article 307 of the EC Treaty requires the Member States to
take all appropriate steps to eliminate the incompatibilities
established with the EC Treaty of the agreements concluded by
them prior to 1 January 1958 or before accession to the Euro-
pean Community.

Pleas in law and main arguments

In France, the grant and continuation of an import authorisa-
tion in respect of parallel imports of plant protection products
from another Member State where they are lawfully placed on
the market are subject to the requirement that parallel imported
plant protection products and reference products have a
common origin.

This constitutes a restriction on the free movement of plant
protection products that is incompatible with Article 28 EC, is
not justified on grounds of the protection of public health,
animal health or the environment and is disproportionate in
relation to the goal to be achieved.

The Commission considers that
the provisions on the free
transfer of investment related payments in the bilateral invest-
ment agreements which the Republic of Austria concluded
with Korea, Cape Verde, China, Malaysia, the Russian Federa-
tion and Turkey before its accession to the European Com-
munity are incompatible with the EC Treaty. This is because
they do not allow the Republic of Austria to apply restrictions
on capital or payments which the Council of the European
Union may adopt on the basis of Articles 57(2), 59 and 60(1)
of the EC Treaty.

The Austrian Government's argument that the way in which it
votes in the Council is not predetermined by the agreements is
irrelevant. The only relevant issue is whether the Republic of
Austria can carry out — in conformity with its obligations
under international law — the restrictive measures in a particu-
lar case. The provisions of the Austrian investment agreements
in dispute show that this is not the case. Likewise, the argu-
ment
from
adopting a decision by a qualified majority is not decisive for
the same reason.

that Austria alone cannot prevent

the Council

Action brought on 5 May 2006 — Commission of the
European Communities v Republic of Austria

(Case C-205/06)

(2006/C 165/30)

Language of the case: German

Since,
in the present case, an incompatibility with the EC
Treaty exists, Austria is under an obligation to take appropriate
steps to eliminate it. If no other means are available, however,
Austria could — according to the case-law of the Court of
Justice — be obliged to abrogate the agreement at issue.

Parties

Applicant: Commission of the European Communities (repre-
sented by: H. Støvlbæk and B. Martenczuk, acting as Agents)

Reference for a preliminary ruling from the Szegedi
Ítélőtábla (Court of Appeal Szeged) lodged on 5 May 2006
— CARTESIO Oktató és Szolgáltató Betéti Társaság

Defendant: Republic of Austria

Form of order sought

(Case C-210/06)

(2006/C 165/31)

Language of the case: Hungarian

— declare that, by not taking suitable measures to eliminate
incompatibilities in relation to the provisions concerning
transfers in the bilateral investment agreements with Korea,
Cape Verde, China, Malaysia, the Russian Federation and
Turkey, the Republic of Austria has failed to fulfil its obliga-
tions under second paragraph of Article 307 of the EC
Treaty;

Referring court

— order the Republic of Austria to pay the costs.

Szegedi Ítélőtábla (Court of Appeal Szeged)