Case C-518/06: Action brought on 20 December 2006 — Commission of the European Communities v Italian Republic
Date: 2007-02-24
Institutions: Court of Justice
Subjects: European Commission, Italy, action for failure to fulfil an obligation, freedom to provide services, insurance premium, motor car, third-party insurance

24.2.2007

EN

Official Journal of the European Union

C 42/15

Action brought on 20 December 2006 — Commission of
the European Communities v Italian Republic

(Case C-518/06)

(2007/C 42/25)

Language of the case: Italian

Parties

Applicant: Commission of the European Communities (repre-
sented by: E. Traversa and N. Yerrell, acting as Agents)

Defendant: Italian Republic

Forms of order sought

The applicant claims that the Court should:

(1) declare that the Italian Republic,

— by introducing and maintaining legislation pursuant to
which premiums for third party motor vehicle liability
insurance must be calculated on the basis of fixed para-
meters;

— by making the premiums for third party motor vehicle

liability insurance subject to controls ex post facto,

has failed to fulfil
the obligations relating to the free
marketing of insurance products incumbent upon it under
the provisions on pricing freedom laid down in Articles 6,
29 and 39 of Council Directive 92/49/EEC of 18 June 1992
on the coordination of laws, regulations and administrative
provisions relating to direct insurance other than life assur-
ance and amending Directives 73/239/EEC and 88/357/EEC
(third non-life insurance Directive) (1) (‘Directive 92/49’);

— by controlling the detailed rules in accordance with
which insurance undertakings which have their head
office in another Member State, but operate in Italy in
exercise of the freedom of establishment or the freedom
to provide services, calculate their insurance premiums;

— by imposing penalties for infringement of the Italian
rules concerning the detailed rules for calculating insur-
ance premiums, even in the case of insurance undertak-
ings which have their head office in another Member
State but which operate in Italy in exercise of
the
freedom of establishment or the freedom to provide
services,

has failed to fulfil its obligations under Article 9 of Directive
92/49;

— by maintaining an obligation to provide coverage for
third party motor vehicle liability, incumbent upon all
including those which have
insurance undertakings,

their head office in another Member State but which
operate in Italy in exercise of the freedom of establish-
ment or the freedom to provide services,

has failed to fulfil its obligations under Articles 43 and 49
of the Treaty establishing the European Community.

(2) order the Italian Republic to pay the costs.

Pleas in law and main arguments

insurance companies

The obligation for
to establish net
premiums in accordance with ‘proper technical bases, which are
sufficiently wide and which extend over at least five business
years’ and to ensure that those premiums comply with a par-
ticular market average, together with the subjection of those
premiums to controls ex post facto — with the consequence that
fines may be imposed by the Italian supervisory
substantial
authority in the case of infringement of those obligations —
constitutes a breach of the principle of pricing freedom provided
for in Directive 92/49. The effect of the Italian legislation is to
set up a system of regulated premiums and thus to prevent
insurance undertakings from marketing their services as they see
fit and freely establishing their pricing policies, and thereby
jeopardising the establishment of the single market in insurance.

The general
interest underlying the adoption of the national
provisions cannot be used by the Italian State to legitimise a
derogation from the principle of pricing freedom for undertak-
ings as established by Community legislation in so far as it does
not fall within the exceptions expressly provided for in the
second paragraph of Article 29, and in Article 39(3), of Direc-
tive 92/49.

insurance premiums,

The control effectively exercised by the Italian supervisory
authority, that is to say, the supervisory authority of the host
Member State, over the detailed rules in accordance with which
insurance undertakings operating in Italy in exercise of freedom
of establishment or the freedom to provide services calculate
together with the imposition of
their
penalties by the Italian supervisory authority for infringement of
the Italian legislation, constitutes a failure to comply with the
allocation of tasks and responsibilities — between the home
Member State (the Member State in which the insurance
company is principally established) and the host Member State
— as provided for in Article 9 of Directive 92/49.

The obligation to provide coverage, imposed on all insurance
undertakings engaged in motor vehicle liability, independently
of the location of the head office, and in relation to all cate-
gories of insured persons and all regions of Italy — coupled
with the possibility that penalties may be applied by the Italian
supervisory authority for infringement of
that obligation —
entails a restriction on the fundamental freedom of establish-
ment, prohibited as such by Article 43 EC, and also constitutes
a restriction of the freedom to provide services, incompatible
with Article 49 EC.
Indeed, the obligation under the Italian
legislation to provide the compulsory motor vehicle liability
insurance constitutes a serious obstacle to engaging in the activ-
ities of an insurance undertaking in Italy, in that such an obliga-
tion discourages insurance undertakings established in other
Member States from establishing themselves in Italy or from
providing services there, and thus impairs access to the Italian
market.

C 42/16

EN

Official Journal of the European Union

24.2.2007

The obligation to provide coverage constitutes an obstacle
which is neither justified nor proportionate in relation to the
aim pursued. Indeed, ‘the concept of public policy may be relied upon
in the event of a genuine and sufficiently serious threat to … one of
the fundamental interests of society’ and ‘the public policy exception,
like all derogations from a fundamental principle of the Treaty, must
be interpreted restrictively’ (see Case C-348/96 Criminal proceedings
against Donatella Calfa [1999] ECR I-11, paragraphs 21 and 23).

Furthermore, that restriction appears to be an inappropriate
means of attaining the objective for which it was adopted, in
that such a generalised obligation to provide coverage hampers
the development and operability of specialised services within
insurance undertakings, which would be better able to satisfy
the needs of consumers properly and efficiently simply because
of being so specialised.

Lastly, such a restriction goes beyond what is necessary in order
to achieve the objective of maintaining public order or of
protecting consumers, both in geographical terms — in that the
problems relating to public order concern, according to the
Italian authorities themselves, only ‘specific geographical areas’ of
the national territory — and in terms of content — in that
insurance undertakings operating in Italy are required to offer
coverage to any owner or driver of motor vehicles, regardless of
the risk posed in practice by that owner or driver as regards
liability for damage caused to third parties.

(1) OJ 1992 L 228, p. 1.

— grant the forms of order sought at first instance;

— order the Commission to pay the costs.

Pleas in law and main arguments

The appellant relies on a single plea in support of its appeal,
based on the error allegedly committed by Court of First
Instance in its legal characterisation of the letter deciding to take
no further action on its complaint. First, the decision taken by
the Commission not to take any further action clearly assumes
a final character in the light of the file; secondly, it is unambigu-
ously apparent from the context
in which the Commission
ruled that it had indeed implicitly taken a reasoned decision on
the classification of the State aid which was the subject of the
complaint. Consequently, the Court of First Instance erred in
law in finding that the contested letter could not be subject of
an action and in dismissing the action as inadmissible.

Action brought on 22 December 2006 — Commission of
the European Communities v Kingdom of Belgium

(Case C-522/06)

(2007/C 42/27)

Language of the case: French

Appeal brought on 21 December 2006 by Athinaiki Tech-
niki AE against the order delivered by the Court of First
Instance (Second Chamber) on 26 September 2006 in Case
T-94/05 Athinaiki Techniki AE v Commission

Parties

Applicant: Commission of the European Communities (repre-
sented by: A. Alcover San Pedro, B. Stromsky, Agents)

(Case C-521/06 P)

(2007/C 42/26)

Language of the case: French

Defendant: Kingdom of Belgium

Form of order sought

The Court is asked to:

Parties

Appellant: Athinaiki Techniki AE (represented by: S.A. Pappas,
lawyer)

Other parties to the proceedings: Commission of the European
Communities, Athens Resort Casino AE Symmetochon

Form of order sought

The Court is asked to:

and

recycling,

destruction

— Declare that, by failing to define the minimum qualification
requirements for certain members of personnel working in
recovery,
of
reclamation
controlled substances in accordance with Article 16(5) of
Regulation (EC) No 2037/2000 of the European Parliament
and of the Council of 29 June 2000 on substances that
deplete the ozone layer (1) and, in respect of the Walloon
Region, by failing to take all precautionary measures practic-
able to prevent and minimise leakages of controlled
substances and by failing to carry out annual checks to
establish the presence or not of leakages in accordance with
Article 17(1) of that regulation, the Kingdom of Belgium
has failed to fulfil its obligations under Articles 16(5) and
17(1) of that regulation.

— annul the contested order;

— Order the Kingdom of Belgium to pay the costs.