CELEX: 61997CC0147
Language: en
Date: 1999-06-01 00:00:00
Title: Opinion of Mr Advocate General La Pergola delivered on 1 June 1999. # Deutsche Post AG v Gesellschaft für Zahlungssysteme mbH GZS) (C-147/97) and Citicorp Kartenservice GmbH (C-148/97). # Reference for a preliminary ruling: Oberlandesgericht Frankfurt am Main - Germany. # Public undertaking - Postal service - Non-physical remail. # Joined cases C-147/97 and C-148/97.

Important legal notice

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61997C0147

Opinion of Mr Advocate General La Pergola delivered on 1 June 1999.  -  Deutsche Post AG v Gesellschaft für Zahlungssysteme mbH GZS) (C-147/97) and Citicorp Kartenservice GmbH (C-148/97).  -  Reference for a preliminary ruling: Oberlandesgericht Frankfurt am Main - Germany.  -  Public undertaking - Postal service - Non-physical remail.  -  Joined cases C-147/97 and C-148/97.  

European Court reports 2000 Page I-00825

Opinion of the Advocate-General

I - The questions referred for a preliminary ruling and the legislative and factual background to the main proceedings 1 By orders of 25 March 1997 received at the Court Registry on 17 April 1997, the Oberlandesgericht (Higher Regional Court) Frankfurt am Main asked the Court for the interpretative guidelines necessary in order to determine the compatibility with the Treaty of a provision of national law which authorises the public postal operator (`the PPO') to charge postage at national rates or to refuse to provide a delivery service for mail from abroad sent by means of ABA non-physical remail. (1) The questions referred by the national court for a preliminary ruling are as follows: A - In Cases C-147/97 and C-148/97: `(1) Is Article 90 of the EC Treaty (now Article 86 EC) to be interpreted as meaning that, in so far as a law ratifying the Conventions of the Universal Postal Union of 14 December 1989 creates the right for the postal service of Member State A to demand internal postage for the delivery of letter-post items sent in Member State B or to refuse delivery if internal postage is not paid, where the content of the letters is determined by an undertaking in Member State A and transmitted by electronic data transfer to an undertaking having its seat in Member State B in order to be printed out, prepared for dispatch and handed over  to the postal service there, that law constitutes a State measure by which, contrary to Article 90(1) of the EC Treaty, a measure was adopted conflicting with Article 86 of the EC Treaty (now Article 82 EC) which does not fall within the exceptions contemplated by Article 90(2)? (2) Are Article 30 of the EC Treaty (now, after amendment, Article 28 EC) et seq. and Article 59 of the EC Treaty (now, after amendment, Article 49 EC) et seq. to be interpreted as meaning that the power of the postal service in Member State A to demand internal postage for the delivery of letter-post items posted in Member State B to addressees resident in Member State A or to refuse to deliver such letters if internal postage is not paid is contrary to the guarantee of the free movement of goods where the content of the letters is determined by an undertaking in Member State A and transmitted by electronic data transfer to an undertaking having its seat in Member State B in order to be printed out, prepared for dispatch and handed over to the postal service there? (3) In the event that the answer to the above questions submitted for a preliminary ruling discloses an infringement of Community law only because the postal service of Member State A receives or, by refusing to deliver mail, can enforce payment of internal postage in addition to the postal charges paid in Member State B or in addition to the terminal dues collected pursuant to the Universal Postal Convention and/or the CEPT Agreement: Is the second paragraph of Article 5 of the EC Treaty (now the second paragraph of Article 10 EC) to be interpreted as meaning that a law of Member State A ratifying the Conventions of the Universal Postal Union of 14 December 1989 is completely inapplicable or only in so far as payment of internal postage in addition to the postal charges paid in Member State B and/or in addition to the terminal dues collected pursuant to the Universal Postal Convention or the CEPT Agreement may be demanded or enforced by refusing to deliver the mail in question?' B - In Case C-148/97 alone: `(4) Is the answer to Questions 1, 2 and 3 altered by the fact that the undertaking having its seat in Member State B which is responsible for printing out mailings, preparing them for dispatch and delivering them to the postal service in that country is linked, as a member of the same group, to the undertaking in Member State A which determines the content of the mailings? (5) Does the answer to Questions 1, 2 and 3 depend on whether the undertaking having its seat in Member State B which is responsible for printing out mailings, preparing them for dispatch and delivering them to the postal service in that country operates only for the undertaking in Member State A which determines the content of the mailings or for a number of principals of the same type?' 2 The fact that the questions referred by the national court in the two cases are partly identical reflects the fact that the factual and legislative background to both cases are essentially the same.  Gesellschaft für Zahlungssysteme mbH (GZS) (hereinafter `GZS'), the defendant in Case C-147/97, is the leading operator in data-processing in respect of transactions carried out with Eurocard credit cards issued in Germany.  GZS, whose members are credit institutions which issue Eurocard credit cards under licence, draws up for the approximately 7 million holders of those cards and the authorised traders monthly statements which are sent out by post.  Since June 1995, GZS has been using electronic data transfer to transmit the data necessary for the drawing up of the statements to a service provider established in Denmark. There, the account statements are compiled, printed out, placed in envelopes and then handed over to the Danish post office, which transmits them to Deutsche Post AG (`DP') for onward carriage in Germany and for delivery to addressees resident there.  For letters sent to addresses resident in Germany, the Danish postal service receives the normal Danish postage rate for mail from abroad, which is lower than the German internal rate, and pays the applicant the `terminal dues' fixed under the Convention of the Universal Postal Union (`the UPU'). 3 Citicorp Kartenservice GmbH (`CKG'), the defendant in Case C-148/97, is an undertaking in the Citibank group which undertakes the administration of the Citibank Visa and Diners credit cards issued by Citibank Privatkunden AG and Diners Deutschland GbmH respectively, members of the group.  CKG states that up to 30 June 1995 the processing of debit and credit data relating to the current accounts of users of German-issued credit cards was carried out at its own computer centre in Frankfurt.  The processed data were then transmitted electronically to Citicorp European Service Center BV (`CESC'), a company having its seat in the Netherlands, for the purpose of preparing account statements, confirmations and detailed statements of account relating to current accounts, and payment and settlement requests.  The data were printed out on standardised forms, placed in envelopes and franked for mailing. (2) Since 1 July 1995 the data are no longer processed in places of business in various countries, but at a single centre for the whole world.  According to the defendant, the data on commercial transactions with authorised traders, the amounts relating to use of credit cards issued in Germany and the debit balances of cardholders are input by the data-processing centre in Frankfurt and then transmitted via satellite to Citibank's world data-processing centre in South Dakota (United States).  There the amount of credit is recorded and debited to the cardholder's account.  The processed data are then sent to CESC where they are printed out and mailed as described above.  In the case of mail for addressees resident in Germany, the Netherlands PPO receives the national rate for mail sent abroad, that is about DEM 0.55, and pays the applicant between DEM 0.37 and DEM 0.40 per standard letter by way of terminal dues. 4 The applicant, a private-law company wholly-owned by the German State, holds a statutory monopoly over the provision of postal services in Germany, including the distribution of incoming cross-border mail. (3) In both sets of main proceedings it is seeking to have the judgments given on 8 May 1996 by the Landgericht (Regional Court) Frankfurt am Main set aside.  At first instance, that court had dismissed the actions brought by DP in 1995 against GZS and CKG claiming payment of the internal postage rate, namely DEM 1 per letter for letters posted in Denmark and the Netherlands and delivered by DP to addressees resident in Germany. The applicant had relied for that purpose on Article 25(3) of the Convention (see point 5 below), which was implemented in the German legal system by the Law of 31 August 1992 on the Conventions of the UPU of 14 December 1989, (4) in conjunction with Paragraph 9 of the Postal Law. 5 The aforesaid UPU Convention (`the Convention'), which was adopted in 1964 under the aegis of the United Nations and to which all Member States of the European Community have acceded, constitutes the frame of reference for relations between the world's postal administrations. (5) One of the fundamental principles of the Convention (see Article 1) is that the postal administration of each member country is obliged to forward and deliver international mail passed to it by other postal services to addressees resident in its territory by the quickest methods it uses for internal post.  For the purpose of the reciprocal exchange of postal correspondence, the countries which have adopted the UPU Constitution (see footnote 5) form a single postal territory throughout which freedom of transit is guaranteed.  However, by way of derogation to Article 1, Article 25 of the Convention (`Posting abroad of letter-post items') provides as follows: `1. A member country shall not be bound to forward or deliver to the addressee letter-post items which senders resident in its territory post or cause to be posted in a foreign country with the object of profiting by the lower charges in force there. The same shall apply to such items posted in large quantities, whether or not such postings are made with a view to benefiting from lower charges. 2. Paragraph 1 shall be applied without distinction both to correspondence made up in the country where the sender resides and then carried across the frontier and to correspondence made up in a foreign country. 3. The administration concerned may either return its items to origin or charge postage on the items at its internal rates.  If the sender refuses to pay the postage, the items may be disposed of in accordance with the internal legislation of the administration concerned. 4. A member country shall not be bound to accept, forward or deliver to the addressees letter-post items which senders post or cause to be posted in large quantities in a country other than the country in which they reside.  The administration concerned may send back such items to origin or return them to the senders without repaying the prepaid charge.' (6) 6 DP claims that the mail in issue must be regarded as having been posted abroad by senders resident in Germany, on the grounds that the reply addresses given in the text of the letters in question (if not on the envelopes or in the address windows) were those of companies established in Germany.  According to the criteria developed by the German courts and cited approvingly in the order for reference, the sender of a letter is the person who, on the basis of the overall impression given by the letter to a reasonable addressee, has contacted the addressee with the direct and specific intention of communicating a message to him. Moreover, the two defendants had forwarded the mail from Denmark and the Netherlands solely in order to take advantage of the difference in the postage charged by the different national postal services and, thus, to circumvent by fraudulent means the postal monopoly exercised by the applicant in Germany.  Since at the material time the cost of printing and placing in envelopes was not more than DEM 0.05 per letter and the terminal dues payable to DP under the CEPT system came to DEM 0.36 per letter (see point 8 below), the cost-saving on sorting, carriage, separate handling and distribution realised by virtue of the remail process was over DEM 0.55 per letter. Discounts had been agreed by the Danish PPO with GZS and by the Netherlands PPO with CKG in order to share the resulting savings between them. 7 At this juncture I would like to dwell briefly on the concept of terminal dues, referred to by the national court in its third question.  According to a principle which has been applied since the UPU's foundation in 1874, since every postal item sent generates a reply, each PPO bore its own costs of forwarding and delivering incoming international mail and did not bill the operators of the countries of origin for them.  However, with the passage of time this assumption of an overall equilibrium between inward and outward mail was contradicted by market data. Accordingly, in 1969 the UPU member countries adopted a system of fixed rates of reciprocal compensation according to the type and weight of postal item. However, this system did not adequately reflect the cost structures of the various operators or the economic value of the delivery service provided by them.  Moreover, it also appeared to take no account of the reality of delivery costs (for example, it is less costly to deliver one item weighing one kilogram than fifty letters each weighing twenty grams). As a result, in 1987 the public postal operators of a number of Member States and non-member countries concluded an agreement in Bern to introduce a new formula for calculating the rates of terminal dues (`the CEPT Agreement').  Under the CEPT Agreement the terminal dues payable by the originating post office to the receiving post office for the service of delivering incoming international mail were substantially higher than under the previous system and consisted of the sum of a fixed component per item (0.147 SDR in 1993) (7) and a weight-based component per kilogram of mail delivered (1.491 SDR in 1993).  The CEPT system was the subject of a Commission inquiry opened in 1993 for suspected breach of the Treaty rules on competition. (8) 8 On 1 January 1996 - subsequent to the facts at issue cases therefore - the CEPT system was replaced by a new agreement on terminal dues called the `REIMS I Agreement' (System for the Remuneration of Exchanges of International Mails between Public Postal Operators with a Universal Service Obligation). (9) In essence, the REIMS I Agreement - signed by 16 public postal operators, 14 of them from the European Community, and governed by the laws of the Netherlands - provided for a system whereby the receiving post office would charge the originating post office a fixed percentage of the former's domestic tariff on all mail received. (10) In accordance with an express provision contained therein, the REIMS I Agreement ceased to have effect on 30 September 1997 because the Spanish PPO, Correos y Telégrafos, had failed to sign it.  A new version of the Agreement, known as REIMS II, came into force on 1 October 1997.  To date, 16 public postal operators, 14 of them from the European Community, have acceded to the Agreement.  The Netherlands PPO, PTT Post BV, which had been a party to REIMS I, has not signed REIMS II and has in fact declared that it has no intention of entering into negotiations. (11) In a recent notice, the Commission announced that it intended to adopt a favourable attitude to the REIMS II Agreement, as amended by a supplementary agreement which was signed by the same parties (except for the Austrian, Belgian, Irish and Spanish operators) in September 1998 and came into force on 1 October 1998. (12) Let me add, for the sake of completeness, that Directive 97/67/EC of the European Parliament and of the Council of 15 December 1997 on common rules for the development of the internal market of Community postal services and the improvement of quality of service (13) provides that in order to ensure the cross-border provision of a universal postal service Member States are to encourage their universal service providers to arrange that in their agreements on terminal dues the following principles are respected: (i) terminal dues are to be fixed in relation to the costs of processing and delivering incoming cross-border mail; (ii) levels of remuneration are to be related to the quality of service achieved, and (iii) terminal dues are to be transparent and non-discriminatory (see Article 13). This provision, to my mind, re-affirms in this area the general principle of cooperation in good faith which requires Member States to take all appropriate measures to ensure the application and effectiveness of Community law (see Article 5 of the Treaty) and which, in the context of the `community governed by the rule of law' established by the Treaty, governs the entire subject of relations between Member States and Community institutions. On the basis of the Court's case-law, Article 5 also constitutes the legal basis for `horizontal' cooperation between national administrations. (14) 9 The fixing of appropriate terminal dues is also dealt with in bilateral agreements between postal operators.  A recent instance is the agreement between the Swedish PPO, Sweden Post, which operates in a competitive environment, and the private operator TNT Post Group, which holds a statutory monopoly in the Netherlands on the delivery of letter-post (up to the weight and price limits prescribed by law).  This agreement provides for the immediate disapplication of Article 25 of the Convention and a phased increase (of 15% each year) in terminal dues, conditional on achievement of the quality-of-service targets set in the agreement, so as to reach 70% of the operators' respective domestic rates by the end of the transitional period (31 December 2003); this agreement was granted exemption from the application of the Community rules on competition by decision of the Commission of 18 September 1998. (15) 10 It is widely acknowledged that terminal dues are currently set at a level so low that they do not cover the public postal operators' costs of sorting and distributing the mail.  The reason usually given for this situation is that the developing countries, whose domestic tariffs are lower than the terminal dues set by the Convention, have blocked the adoption of higher rates.  However, this explanation clearly does not apply where terminal dues are set by multilateral or bilateral agreements between European postal administrations (see paragraphs 8 and 9 above).  Moreover, it seems to me that the very notion of having one rate of remuneration for the provision of cross-border postal service which is identical for all operators who are party to the agreement from which the notion is derived is hard to reconcile with the considerable variation among the different countries of destination both in the universal service provider's actual costs and in postage rates. The applicant, in particular, quantifies its unit loss on the distribution of incoming international mail as approximately DEM 0.40 per item.  This figure is arrived at as follows: according to DP's estimates, its actual delivery costs are DEM 0.80 for a standard letter weighing 20 grams.  As against these costs it would have been entitled under the Convention to terminal dues of DEM 0.16 per standard letter (or DEM 0.18 if the total annual volume of incoming mail from a given member country exceeds 150 tonnes).  Under the CEPT Agreement terminal dues were raised to DEM 0.36 per standard letter.  According to DP, moreover, the only cost saving made on incoming international mail relates to the collection of letters from the post offices or access points in the public postal network.  As against that, international mail is actually more expensive to deliver than domestic mail in the following respects: (i) foreign mail has to be carried longer distances (a high proportion of domestic mail is for delivery within the same town or urban area, or even within the same delivery office district); (ii) addresses are often hand-written (or are otherwise not machine-readable) and (iii) post-codes are often missing or incorrect. Furthermore, DP submits that delivering mail is a highly labour-intensive operation, the cost of which is largely determined by the wages paid to the PPO's employees.  For that reason, the applicant claims, it would be wrong to attribute the high level of domestic postage rates to inefficiency on the part of the PPO providing the service. 11 Another point is that the various rules concerning terminal dues - agreed under the aegis of the UPU, the CEPT and in the REIMS Agreements - do not in any way alter the rights of public postal operators for the purposes of Article 25 of the Convention (but see footnote 12 above). Furthermore, the Convention does not require PPOs to deduct terminal dues already received from the domestic postage charged under Article 25(3).  However, in a press release issued on 17 April 1997 DP announced that it would do so unilaterally (and it repeated this intention at the hearing). 12 The discussion up to this point has shown how the remail phenomenon (see footnote 1 above) owes its origin to the differences in the prices charged for delivering mail (national and international) in the various UPU member countries combined with the relatively low level of terminal dues agreed by the public postal operators.  The remailer aims, inter alia, to exploit those price differences by inviting businesses to consign their mail to the postal operators which offer the best quality/price ratio for a particular destination. II - Legal analysis 13 By the first two questions referred, the national court in substance asks the Court whether legislation enacted by a Member State to implement the Convention, including Article 25 thereof, constitutes a measure which, if enacted or maintained in force by the Member State concerned with respect to a public undertaking or an undertaking to which special or exclusive rights have been granted, is contrary to the Community rules on free movement of goods, on freedom to provide services and on competition under Article 90(1) of the Treaty.  At the end of the first question the national court also asks the Court to interpret Article 90(2) of the Treaty in order to give guidance as to whether the national postal administration in question, in respect of which the contested measure was enacted, must be regarded as exempted from the application of the Treaty rules where the conditions laid down in that article are satisfied.  It is the settled case-law of the Court that Article 90(1) and (2) of the Treaty may be relied upon directly by individuals before a national court if there is proof of the infringement of other Treaty provisions having direct effect. (16) Have the defendants abused the freedoms guaranteed by the Treaty with the result that the Treaty provisions referred to by the national court can have no application to their situation? 14 I shall first consider the merits of one of the arguments put forward by DP which in my view precedes and transcends the others.  The applicant maintains - and the Commission agrees - that postal items mailed to addressees resident in Germany from another Member State, the content of which is ultimately determined by a German economic operator affiliated to and/or having a contractual relationship with the physical sender, are necessarily subject to Germany's domestic postage rates.  It is thus not open to the defendants, their partners or the Danish and Netherlands postal operators to rely on the protection conferred by the relevant Treaty provisions since the practices in issue, aimed as they are at circumventing DP's statutory monopoly, are by nature fraudulent.  In the particular case of CKG, despite the fact that it belongs to a multinational group of companies, the motive for relocating printing and posting operations for its `German' letters to the Netherlands was obviously that of saving on postage costs.  DP suggests the case comes within the Van Binsbergen doctrine, (17) according to which the beneficiaries of provisions of Community law may not exercise their rights abusively or fraudulently and, consequently, a Member State has the right to take measures to prevent its nationals exploiting the possibilities offered by the Treaty in an attempt to avoid the application of domestic legislation.  As for the alleged breach of Articles 90(1) and 86 of the Treaty, DP argues that, because the dominant undertaking sought to defend itself against fraudulent conduct by third parties, the action it took in response to such conduct was not unlawful. 15 In my recent Opinion in Centros I observed, and I now reiterate, that `the question of abusing the law can arise only if the rule that is apparently being avoided undoubtedly applies to the legal situation at issue.  If the apparent avoidance concerns a provision of national law, it is therefore essential to ascertain first that the national provision it is hoped to apply in the case at issue can be relied on by the court as being consistent with Community law'. (18) In this respect, however, it seems to me that DP's line of argument begs the question. The applicant's premiss appears to be that German legal persons carrying on a business directed essentially at the German market may not outsource even one stage of the whole production process of the product or service in question to entities genuinely established in another Member State. According to this argument, the exercise of the freedom, which the Treaty confers on the parties concerned, to choose from among the contractual arrangements and corporate structures offered by the various national legal systems the one which best suits their purposes could not thus, under any circumstances, have the effect of preventing the application of German domestic mail tariffs to postal items of the kind in issue.  I do not see, however, how this proposition can be defended at the current stage of European integration, in which a single market has been all but implemented thanks to the abolition of national obstacles to the free movement of persons and capital (see Article 3(c) of the EC Treaty (now, after amendment, Article 3(1)(c)).  It is my opinion that once freedom of establishment (relied upon by CESC, the service provider affiliated to CKG) and freedom to provide services (relied upon both by the defendants (19) and by their partners) are exercised in conformity with the Treaty, the rationales or motives for the choice of the party concerned are not relevant and are therefore not reviewable by the courts. (20) Indeed, these principles were endorsed by the Court in Centros, in which it was held to be contrary to Article 52 of the EC Treaty (now, after amendment, Article 43 EC) and Article 58 of the EC Treaty (now Article 48 EC) for a Member State to refuse to register a branch of a company formed in accordance with the law of another Member State in which it has its registered office but in which it conducts no business.  In that case, the establishment of a branch in another Member State enabled the company in question to carry on its entire business in that State rather than in the State in which it had been formed itself, thereby avoiding the formation of a different type of company in the Member State where it had established a mere branch and the need for compliance with that State's minimum share capital requirements, which were stricter than those of the Member State in which the parent company was formed.  This result is lawful since it is covered by freedom of establishment within the meaning of the Treaty. (21) Let us turn our attention to the present case.  Contrary to the view taken by DP and the Commission, the case-file provides no basis for concluding that the defendants, by centralising their billing operations (data processing and printing) and the sending of other messages to the users of the credit cards they `administered', have acted in an unreasonable and unconscionable manner, for the sole purpose of obtaining, to the detriment of others, improper benefits which were manifestly alien to the purpose of the Treaty rules on freedom of establishment and freedom to provide services. (22) The legal situations at issue in the main proceedings are therefore covered by the Treaty provisions referred to by the Oberlandesgericht.  May I add, incidentally, that in the light of what I have observed up to now, the content of the answers I shall be giving to the first three questions referred has not been influenced by the circumstances referred to by the national court in the fourth and fifth questions submitted in Case C-148/97 (see point 1 above). Is the Treaty applicable to the present case notwithstanding the fact that the national measure at issue was enacted in order to implement an international convention? 16 It is not in dispute - the point was not even mentioned in the order for reference - that if the measure at issue were found to be contrary to the provisions referred to by the national court, in the manner alleged by the defendants, such a breach could not be remedied merely by virtue of the fact that the contested provisions were enacted by the German legislature in pursuance of an international agreement, whether before or after the Treaty (see footnote 5 above), to which all the Member States have now acceded.  Moreover, Article 25 of the Convention imposes no obligation on the member countries. (23) It merely gives national postal administrations a right to return the relevant items to origin or to charge postage on them at their internal rates (and, if the sender refuses to pay the postage, to dispose of the items in accordance with their domestic legislation). Is DP to be characterised as an undertaking of the kind referred to in Article 90(1) of the Treaty? 17 It appears to me equally clear that the contested measure is of the kind covered by Article 90(1) of the Treaty, having regard to the dual nature of the entity which benefits from the measure.  DP is characterised both as a `public undertaking' (24) and as `an undertaking to which a Member State grants exclusive rights'. (25) The Treaty provision in question, which is included among the rules on competition, provides that in the case of the undertakings in question, Member States are neither to enact nor to maintain in force any measure contrary to the rules contained in the Treaty, in particular (but not solely, therefore) those rules provided for in Article 6 of the EC Treaty (now, after amendment, Article 12 EC) and Articles 85 to 94 of the EC Treaty (the common rules on competition).  That being said, I shall adhere to the order in which the national court stated the questions referred. I shall first consider the question of the compatibility of a State measure such as the German legislation implementing the Convention (including Article 25 of that international agreement) with the prohibition of the abuse of a dominant position. Answer to the first part of the first question submitted (Articles 90(1) and 86 of the Treaty) 18 To begin with, according to the case-law of the Court, an undertaking such as DP, which has a statutory monopoly over a substantial part of the common market, must be characterised as an undertaking in a dominant position within the meaning of Article 86 of the Treaty.  The territory of a Member State over which such a monopoly extends may constitute a substantial part of the common market. (26) The Court has also adopted the principle that, while the simple fact of creating a dominant position by granting an exclusive right within the meaning of Article 90(1) of the Treaty is not in itself incompatible with Article 86 of the Treaty, a Member State is in breach of the prohibition contained in those two provisions if the undertaking in question, merely by exercising the exclusive rights granted to it, cannot avoid abusing its dominant position, or where those rights are liable to create a situation in which that undertaking is led to commit infringements. (27) 19 Instances of abuse of a dominant position, within the meaning of Article 86 of the Treaty, include refusal by the dominant undertaking to supply a service to all-comers (28) or the application of dissimilar conditions to equivalent transactions, (29) where such conduct has a detrimental effect on trade between Member States.  No doubt, such practices are probably not anti-competitive if engaged in by an undertaking which does not occupy a dominant position.  However, it is the settled case-law of the Court that dominant undertakings have a special responsibility not to allow their conduct to impair genuine undistorted competition on the common market. (30) Let us now apply these principles to the present case.  The defendants, who have been targeted by DP on the basis that they are the `actual senders' of the items posted abroad (see paragraph 6 above), remain nevertheless subject - with the alternative of being refused delivery - to an overall postage charge which is greater than that paid by a sender posting letters in Germany for domestic delivery.  This charge is made up of the sum of: (i) the domestic tariff of the Member State of destination plus (ii) the international tariff of the Member State of posting, a portion of which is still paid to the PPO of the former State by way of terminal dues.  What is more, the legislation in issue to my mind comports a further form of unequal treatment to the detriment of undertakings in a similar situation to that of the defendants as compared with persons sending items from the same Member State in which they were made up and posted but not on the instructions or on behalf of senders resident in Germany.  Under the Convention, DP is not entitled to charge its own domestic rates on top of the terminal dues for the distribution and delivery of such items. (31) According to the Oberlandesgericht, however, this would presuppose that Article 86 of the Treaty requires the national court to take terminal dues into account in calculating the total price demanded by the dominant undertaking, despite the fact that these are paid not directly by the senders subject to the discriminatory treatment but by the foreign postal operators, who pass on part of the international tariffs collected by them from the Danish and Netherlands service providers.  In other words, subparagraph (c) of the second paragraph of Article 86 of the Treaty makes the application of the prohibition conditional on whether or not GZS and CKG - who in fact are purchasing a complete service, including delivery of postal items mailed abroad on their behalf, from their respective service providers - constitute `other trading parties' vis-à-vis DP.  But these objections appear not to take due account of the fact that the conduct specified in the second paragraph of Article 86 of the Treaty is given by way of example only.  Accordingly, the prohibition imposed by that article can also be infringed by a dominant undertaking which exploits its market power through forms of conduct other than that considered here. (32) Therefore, the fact that the contested measure concerns a public law relationship between the postal administration and the `virtual' sender of the items posted abroad and does not depend on there being a direct contractual or commercial relationship between the PPO and the party on whom the sanction is imposed is not, to my mind, sufficient to take it outside the scope of application of the prohibition in question.  In short, under the Community rules on competition, the identity of the party who ultimately determines the content of postal items (GZS and CKG, or their respective partners) cannot be a factor which justifies a refusal by DP to provide service or which calls into question, in either of the two cases described above, the equivalence of the services to which DP applies dissimilar contractual conditions. 20 Nor is there any doubt, in my opinion, that a measure of the kind at issue is capable of having an appreciable detrimental effect on trade between Member States. (33)  It induces an undertaking holding exclusive rights to penalise an undertaking (from the same country) specifically because the latter is determined to be the true sender of postal items franked and mailed in another Member State by local service providers and then conveyed across the national borders by that State's PPO.  As regards the requirement of `appreciable' detriment to trade between Member States, DP itself submits that over 20% of its own deliveries of standard letters consists of the forwarding of regular items in a uniform format which do not require the letter-writer's signature and which can be produced mechanically, and that the issue as to the applicability of Article 25 of the Convention therefore concerns, at least potentially, quite substantial volumes of foreign mail. 21 In the light of this, it now needs to be considered, in accordance with the criterion laid down in the case-law of the Court (see point 18 above), whether the exclusive rights held by the dominant undertaking are liable to create a situation in which that undertaking is led to commit abuses of the kind referred to by the national court.  In order for the Member State concerned to be found (even incidentally) to be in breach of Articles 90(1) and 86 of the Treaty, it is therefore necessary that the abuses mentioned above are the direct consequence of the national measure in issue.  Now it is true that in the present case the German implementing legislation, in accordance with Article 25 of the Convention, confers a right and not an obligation on the national PPO to return items to origin or to charge postage at its internal rates.  But it is hard to see why the postal administration with a monopoly, which is not exposed to commercial competition in the provision of the reserved services, would in practice refrain altogether or in part from exercising the right in question, given the clear and objective economic incentive to charge senders of postal items, in the specified circumstances, the highest price permitted under the applicable legislation. The purely theoretical nature of the possibility of waiving the right is, indeed, borne out by the facts in the main proceedings.  The same conclusion would be warranted, in my view, even if the national court had not found any actual abuse to have been committed by the German postal monopoly. (34) On these grounds, provisions such as those contained in the legislation implementing the Convention must be regarded as per se contrary to Article 90(1) in conjunction with Article 86 of the Treaty. Answer to the second question referred (Articles 30, 59 and 90(1) of the Treaty) 22 Should the Court agree with my answer to the first question referred, it will not need to consider the second question, concerning whether a national measure such as the German legislation implementing the Convention is contrary to Articles 30 and 59 (in conjunction with Article 90(1)) of the Treaty.  I shall therefore confine myself to a rapid examination of the issue.  To begin with, the present case does not come within the scope of the Community rules on the free movement of goods. According to the definition of `goods' adopted by the Court in relation to the interpretation of Article 30 of the Treaty, the prohibition of national measures which form a barrier to trade between Member States concerns objects which can be valued in money and which can be physically transported across a border with a view to sale or other lawful commercial transactions, whatever the nature of those transactions. (35) Postal items of the kind at issue in this case do not, as such, constitute objects of sale or other transactions. One cannot therefore speak of a commercial transaction in goods, ancillary to, and connected with, the provision of a service but conceptually and economically separable from it, nor of a principal transaction which absorbs another transaction which is purely accessory and incidental to it. (36) The only transaction identifiable in the present case is the provision of international letter-post services to the sender by the PPO of the country of posting against payment of the relevant postage tariff. (37) The national court has also asked the Court for guidance on the interpretation of Article 59 et seq. of the Treaty.  To begin with, according to the Court's case-law, the rules on equal treatment prohibit not only overt discrimination by reason of the nationality of the service provider (or, in the case of a company, the country in which its registered office is located) or by reason of the fact that it is established in a Member State other than that in which it is intended to provide the service, but also all covert forms of discrimination which, by the application of other criteria of differentiation, lead in fact to the same result. (38) A discriminatory national rule is compatible with Community law only if it can be brought within one of the derogations expressly provided for in Article 55 of the EC Treaty (now Article 45 EC: `activities which [in any given Member State] are connected, even occasionally, with the exercise of official authority') and in Article 56 of the EC Treaty (now, after amendment, Article 46 EC: `grounds of public policy, public security or public health'), to which Article 66 of the EC Treaty (now Article 55 EC) refers. (39) In the present case, the Oberlandesgericht has raised the possibility of an indirect restriction on the services offered by the postal operators of other Member States: the imposition by DP of a surcharge consisting of the domestic postage rate could have the effect of reducing the flow of mail from Denmark and the Netherlands to Germany. (40) The defendants, for their part, have submitted that the application of Article 25 of the Convention by the German PPO also infringes - at an earlier stage in the process - the freedom of providers of mail preparation and mailing services established in other Member States - such as CESC and GZS's Danish  partner in the present case (41) - to maintain business relationships with customers established in Germany.  It is my view that these arguments are both valid and pertinent: contrary to the view put forward by DP, Article 59 of the Treaty is also infringed by State rules which, while they do not completely prevent the provision of cross-border services, discourage it, by making it less attractive economically. (42) I would also point out that the contested measure applies only to the delivery of items posted abroad (for our purposes, in other Member States).  In short, the objective invoked by DP, that of maintaining sufficient financial equilibrium to enable it to fulfil its universal service obligation in the provision of the reserved services, is economic in nature and does not justify the measure at issue on the basis of Article 55 or 56 of the Treaty (see footnote 39 above).  Accordingly, the second question submitted - in the part which refers to freedom to provide services - should be answered in the affirmative: the national legislation at issue constitutes a discriminatory measure contrary to Articles 90(1) and 59 of the Treaty, since it operates to the detriment of service providers in other Member States.  I shall deal below with the question of whether an undertaking in DP's position may, in circumstances such as those of the present case, rely on the derogation provided for under Article 90(2) of the Treaty (see points 24 to 30 below). Does DP's unilateral commitment to deduct the terminal dues from the full domestic postage rate have a bearing on how the contested national measure is to be judged? 23 The conclusions which I have reached (paragraphs 21 and 22 above) are not contradicted by the fact that DP has unilaterally assumed, independently of any requirement under the Convention, an obligation to deduct - whether with prospective or retrospective effect, in the context of the main proceedings - the amount of the terminal dues (already received by it from the PPO of the Member State of posting) from the full domestic postage rate claimed by it from the sender in cases to which Article 25 applies.  The Court is called upon to interpret Articles 90(1), 86 and 59 of the Treaty, and considerations of legal certainty dictate that it must take account of the abstract and general rules laid down in the national legislation rather than the way in which the national legislation may be specifically applied by the privileged undertaking at issue in the main proceedings.  If that be so, tertium non datur: either the Court will decide that the Article 90(2) derogation is applicable in the present case (see points 24 to 30 below) and the national legislation implementing the Convention will remain applicable in the light of the whole of Article 25 (subject, naturally, to DP's right unilaterally to waive part of its claims) or else the Court will decide that the criteria for the application of the derogation are not satisfied in the present case and the national court will be bound not to apply the contested provisions (as I shall discuss below in my analysis of the third question referred; see point 31 below). Answer to the second part of the first question referred (Article 90(2) of the Treaty) 24 DP submits in the alternative that if the Court found an infringement of Article 90(1) in conjunction with Article 86 - or, I would add, Article 59 of the Treaty - to have taken place, an undertaking in its situation would be covered by the derogation provided under Article 90(2) of the Treaty.  According to the applicant, the application of the provisions in question obstructs it in the performance of the particular tasks assigned to it by the German State. The national court, on the other hand, seems to find that the applicant is not dependent on the right, which it has asserted in these proceedings, to charge internal postage rates in addition to terminal dues, in order to maintain a universal service at socially acceptable prices. In support of this view, the referring court submits that the applicant receives higher overall revenues from delivering incoming cross-border mail than from delivering ordinary domestic mail, although the service costs no more to provide.  The national court also points out that the level of national postage rates must, under domestic law, meet the objective of realising a modern, economic postal service covering the entire territory. (43) That being so, it must be presumed that the amount of the uniform tariff offset is sufficient to enable DP to perform its general interest obligations on an economically sustainable basis. Finally, the national court observes that not only have the lower revenues collected by the applicant on account of non-physical remail operations not yet led to an increase in postage rates but DP could, in any event, anticipate future losses by negotiating an increase in terminal dues to bring them into line with actual costs, as has already been done under the REIMS Agreement. 25 As the Court held in Corbeau, the collection, carriage and distribution of mail constitutes a service of general economic interest. (44) DP is entrusted, by the public authorities, with the operation of such a service for the benefit of all users throughout the whole of Germany, at uniform tariffs and on similar quality conditions, irrespective of the specific circumstances or the degree of economic profitability of each individual operation (see footnote 3 above together with the part of the main text to which it relates). (45) Given that this is so, it must be determined whether or not, in the present case, the two conditions for the application of the derogation provided under Article 90(2) of the Treaty are met, that is (i) whether the performance of the particular tasks assigned to the PPO would be obstructed, in law or in fact, by the application of the Treaty rules (in this case, the rules on freedom to provide services and those on competition) to the contested measure, (46) and (ii) whether the non-application of the Treaty rules in question would affect the development of trade to such an extent as would be contrary to the interests of the Community, which here consist, in my opinion, in the promotion of economic and social cohesion between Member States through the establishment of the internal market in the postal sector. (47) What must be determined is, in other words - and the burden of proof certainly lies with the party invoking the derogation: (48) the applicant in the present case - whether the rights conferred by the national measure which implements Article 25 of the Convention in Germany are necessary to enable DP to perform, under economically acceptable conditions, (49) its particular obligations to provide services falling within the scope of the universal service.  However, it is not necessary, in order for the derogation to apply, that there be a threat to the very survival of the undertaking concerned, that is to its financial balance or economic viability. (50) 26 In the context of postal services, the concept of `universal service obligation' (`USO') appears to be founded on a basic principle of fairness, according to which it is the State's duty as far as practicable to create equal opportunities and living conditions for all its citizens, including the provision of a means of inter-personal communication, in order to promote social cohesion. (51) A monopoly undertaking subject to a USO is thus generally required to charge uniform prices for delivering the mail to any geographical area within the national territory, although the cost of providing the service may vary considerably from place to place because of the distances involved and the density of traffic at the points of origin and destination or over a particular segment. (52) In many countries, besides, the PPO is allowed to vary its pricing policy to some extent by reference to other parameters (such as the weight of items or handling and delivery times). 27 In its observations, DP refers to the normal cost implications for a PPO of being subject to a USO.  It should be taken into consideration, for example, that the delivery of mail to remote or thinly populated areas is loss-making at the uniform tariff, although the resulting losses are covered by the profits generated from providing the service in areas (or fields) which are less costly to serve but charged at the uniform `equalised' tariff. (53) The cost of fulfilling the USO also depends on the particular terms imposed by the State on the PPO, in particular the minimum quality-of-service standards prescribed (delivery times, frequency of delivery and reliability of the universal service). (54) Moreover, in the present phase of gradual and controlled liberalisation of the market, it is this need to enable the universal service to operate under financially balanced conditions which justifies the maintenance in almost all the Member States of a range of services, defined by weight and/or price limits, which are reserved to the national PPO. (55) As the Court observed in Corbeau, a USO imposed by a Member State on its postal monopoly presupposes that it will be possible to cross-subsidise between users and destinations and hence justifies a restriction of competition from private undertakings in the economically profitable sectors. In a liberalised market the new entrants would tend to engage in `cream-skimming', in other words to concentrate on the economically profitable operations covered by the universal service.  In these sub-markets they would be able to offer lower tariffs than the PPO, even if they were less efficient, as long as their costs of delivering the service were less than the uniform tariff charged by the PPO.  The simple reason being that, unlike the latter, competitors would not be obliged to apply all or part of the profits earned in the profitable sectors to offset losses incurred in the unprofitable sectors. (56) In turn, the loss of fairly substantial parts of a postal administration's business to new entrants would reduce the flow of internal resources which it relies upon in order to fulfil its USO. (57) 28 Of course, it is understandable that the applicant is aggrieved at the fact that the profits it earns from one of the activities reserved to it by statute as a quid pro quo for its USO may turn out to be lower than its expected or potential earnings.  And I concur with DP's point that the REIMS II Agreement, which of course does not apply to the present case ratione temporis (see point 8 above), is not going to provide a future solution to the problem of terminal dues being too low to cover actual delivery costs, given that the Netherlands PPO is not a party to that agreement.  The fact remains, however, that if DP is nonetheless capable of performing its particular obligations to provide services within the scope of the universal service, under economically acceptable conditions, the rights conferred by the national measure implementing Article 25 of the Convention in Germany cannot be deemed necessary for the purposes of Article 90(2) of the Treaty (see paragraph 25 above). 29 In a situation such as that considered in Corbeau, the interference with the economic and financial equilibrium of the PPO subject to the USO derives from the fact that the third party's conduct - to which the PPO responds by conduct which, if caught by the Treaty, would be contrary to it - relates specifically to the profitable sectors, in other words those sub-markets in which, according to the internal logic of the USO, the postal monopoly must achieve the profits needed to fund its operations in the loss-making sub-markets.  In contrast to the facts in Corbeau, here the national measure at issue is not aimed at restricting or preventing the possible `cream-skimming' of the profitable sectors within the reserved services by competitors of the PPO and thereby at protecting the universal postal service of the Member State concerned. DP, the undertaking subject to the USO in Germany, is not invoking the national measure implementing Article 25 of the Convention in order to safeguard its own exclusive prerogatives from attack by competitors wishing to enter the relevant sub-market nor does it argue that, within the scope of the reserved services, incoming cross-border mail is precisely one of the profitable sectors from which it derives the internal resources necessary for the performance of its tasks. In the present case the operator subject to the USO is in fact acting to protect its earnings levels from the potentially adverse impact of the Convention provisions on terminal dues, which it in fact helped to draft and which it signed together with the other public postal operators. That is why DP invokes the right to refuse to supply one of the services reserved to it (incoming cross-border mail from another Member State), or to make provision of that service conditional on payment of the tariff applicable to another reserved service (domestic mail) in addition to the postage already paid in the country of origin.  The applicant seeks to justify this position by asserting that the delivery costs of cross-border mail posted in another Member State are greater than the revenue received (terminal dues) and that, because of the use of non-physical remail, it will receive only terminal dues on substantial volumes of mail - which are likely to increase further in the future - for which it is entitled to the uniform national tariff.  According to the applicant, the flow of internal resources on which it can draw to fulfil the USO will thus be irremediably depleted. (58) 30 In order to be entitled to invoke the derogation provided for under Article 90(2) of the Treaty, DP must therefore furnish, in the proceedings before the Oberlandesgericht, a reliable estimate of the volume of mail which would otherwise attract the equalised domestic tariff and which - due to the obvious imbalance between delivery costs (reflected in the domestic rates) and terminal dues - is diverted to the incoming cross-border mail service by the use of non-physical remail. In addition, the applicant must produce, based on a proper internal cost accounting system (59) and objective and reliable market data, an estimate of the probable loss of revenue, (60) and prove its inability to generate similar revenue from the supply of other reserved services.  The basis of comparison to be used to determine whether the application of the Treaty rules to an undertaking in DP's position would or would not compromise its ability to provide the universal postal service under conditions of economic equilibrium is the level of profits it earns, applying the uniform equalised tariff, in the profitable sectors within the universal service.  DP's submissions appear, however, to proceed from the opposite premiss, by assuming that it should be possible to provide each of the services within the reserved sector under conditions of financial equilibrium.  As I have already pointed out (see point 27), however, it is entirely inherent in the performance of the obligation to provide a universal postal service under conditions of financial equilibrium that profitable operations can cross-subsidise non-profitable ones, within the reserved services of course. (61) DP must therefore satisfy the national court that, if it is not permitted to apply Article 25 of the Convention to postal items of the kind in question, it will not be able to offset the losses it may incur in the sub-market of incoming cross-border mail, plus those it may incur in other sectors covered by the USO, with profits achieved in the profitable sectors within the universal service, whether those reserved to it or otherwise. Finally, in order to uphold the principle of proportionality - which, in those sectors in which Member States have retained discretionary powers, requires the public authorities to choose, in pursuing a legitimate public-interest objective, the measures, procedures and sanctions which are least restrictive of the fundamental freedoms guaranteed by the Treaty and, in general, of rights conferred on individuals by the Community legal order (62) (see footnotes 16 and 17 above) - the national court will in any event be precluded from applying Article 90(2) of the Treaty if it is the case that other measures less restrictive than that allowing DP to return the disputed mail to origin or to charge its own domestic rates would permit DP to perform the task of providing universal postal service in Germany under conditions of financial equilibrium. (63) I would add, in this regard, that - even were one to accept the applicant's argument that the necessity for the national measure should be assessed in the light of the need for the incoming cross-border mail service, taken on its own, to be provided under conditions of parity as between income and expenditure - charging the full internal tariff for postal items of the kind in question would still be disproportionate, since it would be enough for an operator in DP's position to charge the `virtual' sender the difference between the actual proven costs of the service and the terminal dues received. Answer to the third question referred 31 By the third question referred, the Court is asked to state the legal consequences that would ensue if the national court were to find that the contested measure is incompatible with the Treaty rules referred to in the first two questions.  On this point, I need only recall the Court's case-law, according to which the national court before which a case has been brought must apply Community law in its entirety and protect the rights which the latter confers on individuals, notwithstanding any contrary provisions of national law, whether enacted before or after the relevant provision of Community law. (64) A measure such as that at issue here cannot have any bearing on the outcome of the present case, unless an undertaking in DP's position may come within Article 90(2) of the Treaty - by way of derogation from the directly effective rules contained in Articles 90(1), 86 and 59. In its formulation of this question, however, the referring court adopts a different reading of the legislative provisions which it is called upon to review: the contested measure authorises DP, theoretically, to charge the full postage or, alternatively, not to deliver the mail; and if, in reality, the privileged undertaking chooses to refund the postage already paid in the Member State of posting or the terminal dues, this conduct on its part combines with the measure itself, so as to constitute a factor determining its scope of application.  But this view must be rejected, deprived as it is of any basis, whether in Article 5(2) or in any other provision of the Treaty.  If the `shield' of national legislation falls, the issue of the lawfulness, in terms of competition law, of conduct on the part of an undertaking holding exclusive rights, consisting of making the delivery of mail posted in another Member State conditional on the payment of separate and additional tariffs to those already paid by the sender in the Member State of posting, must be examined directly on the basis of Article 86 of the Treaty alone: (65) and this is so whether the PPO concerned charges the full amount of the domestic tariff or makes a deduction for the terminal dues it has received.  But such issues, clearly, lie entirely outside the scope of the questions referred in this case. Answer to the fourth and fifth questions in Case C-148/97 (reference) 32 Turning finally to the remaining two questions referred by the Oberlandesgericht in Case C-148/97 alone, it is my opinion that these should be answered in the negative, for the reasons given above (see point 15). III - Conclusion In the light of the foregoing considerations, I suggest that the Court answer the questions referred to it by the Oberlandesgericht as follows: A - In Cases C-147/97 and C-148/97: (1) The combined provisions of Article 90(1) of the EC Treaty (now Article 86(1) EC), Article 59 of the EC Treaty (now, after amendment, Article 49 EC) and Article 86 of the EC Treaty (now Article 82 EC) must be interpreted as precluding the application of a national law ratifying the Conventions of the Universal Postal Union of 14 December 1989, in so far as it creates the right for the undertaking holding exclusive rights for the provision of the postal service of Member State A to demand internal postage for the delivery of letter-post items sent in Member State B or to refuse delivery if internal postage is not paid, where the content of the letters is determined by an undertaking in Member State A and transmitted by electronic data transfer to an undertaking having its seat in Member State B in order to be printed out, prepared for dispatch and handed over to the postal service there.  The national court is therefore bound to disapply that national law in its entirety. (2) Article 90(2) of the EC Treaty (now Article 86(2) EC) must be interpreted as not authorising an undertaking holding exclusive rights, which is entrusted with the provision of the universal postal service in the territory of Member State A, to rely on a national measure such as that in issue in the main proceedings to demand internal postage for the delivery of mail sent in Member State B or to refuse delivery if internal postage is not paid, where the content of the letters is determined by an undertaking in Member State A and transmitted by electronic data transfer to an undertaking having its seat in Member State B in order to be printed out, prepared for dispatch and handed over to the postal service there, unless the undertaking entrusted with the provision of the universal postal service in Member State A adduces proof, based on transparent, detailed and verifiable internal accounts and objective and reliable market data, that: (i) the application of Articles 90(1), 59 and 86 of the Treaty to the contested national measure would prevent it from providing the universal postal service under conditions of financial equilibrium and (ii) this objective cannot be achieved by other less restrictive measures. B - In Case C-148/97 alone: (3) The answers to Questions 1 and 2 are not dependent on the fact that the undertaking having its seat in Member State B which is responsible for printing out mailings, preparing them for dispatch and delivering them to the postal service in that country is linked, as a member of the same group, to the undertaking having its seat in Member State A which determines the content of the mailings.  Similarly, if the two undertakings are independent of one another, it is immaterial whether the undertaking having its seat in Member State B operates only for the undertaking having its seat in Member State A or for a number of principals of the same type. (1) - It is customary to distinguish between three categories of remail services: - `ABC remail', where mail originating in Country A is transported by private companies to Country B and put into the postal system there for forwarding via the traditional international postal system to Country C, where the final addressee resides; - `ABB remail', where mail originating in Country A is transported by private companies to Country B and put into the postal system there in order to be delivered to the final addressee who resides in Country B; - `ABA remail', where mail originating in Country A is transported by private companies to Country B and put into the postal system there for forwarding via the traditional international postal system back to Country A, where the final addressee resides. To those three traditional types of remail should be added so-called `non-physical remail'.  In this form of remail, information from Country A is sent electronically to Country B, where, with or without processing, it is printed, transported and put into the postal system of Country B or Country C in order to be forwarded via the traditional international system to Country A, B or C, where the final addressee resides.  As the defendants have pointed out, the term `non-physical remail', while widely used in practice, is technically a misnomer because there is no object which physically crosses the national border twice but just one object which is made up in a foreign country on the basis of data transmitted from the State of destination. (2) - These letters, on which the sender was stated as being `Citibank European Service Center, P.O. Box 5411, 6802 EK Arnhem, The Netherlands' or `Citicorp European Service Center BV, P.O. Box 5200, 7570 GE Oldenzaal, The Netherlands', were then handed over to the Netherlands PPO which conveyed them to DP for delivery to addressees resident in Germany. According to CKG's written observations, in addition to the defendant itself, undertakings and branch networks of the Citibank group in France, Belgium, Spain, Portugal and Greece are linked to the central CESC facility for data acquisition, data processing, data print-out and mailing; the intention is for undertakings from other European countries to link up as well, once there are enough cardholders in those countries.  CESC currently employs 22 staff and sends an annual 42 million letters to addressees resident in Member States of the European Union. (3) - Paragraph 2 of the Gesetz über das Postwesen of 3 July 1989 (`the Postal Law') reserves to the successor company to Deutsche Bundespost Postdienst [the public-law body which was transformed into the public limited company DP in preparation for its planned privatisation in 2000, pursuant to Paragraph 2(1) of the Gesetz zur Neuordnung des Postwesens und der Telekommunikation (Postal Services and Telecommunications Restructuring Law, `the PTNeuOG') of 14 September 1994, BGBl. Part I, p. 2325] the exclusive right to form and operate undertakings forwarding written messages and other communications between individuals for reward. Moreover, under Paragraph 7 of the PTNeuOG, which refers to the Gesetz über die Regulierung der Telekommunikation und des Postwesens [Law Regulating Telecommunications and Postal Services (`the PTRegG'); BGBl. 1994 Part I, p. 2371], DP is bound by a universal service obligation: everybody has the right to use its postal services other than those services liberalised by way of derogation from Paragraph 2 of the Postal Law. As from 1 January 1998, distribution of the following items is reserved to DP: (i) letters and addressed catalogues up to a weight-limit of 200 grams where the cost of sending them is not greater than five times the basic rate in force on 31 December 1997 and (ii) direct advertising by mail up to a weight-limit of 50 grams per item where the total number of items sent is less than 50. These exclusive rights will expire on 1 January 2003 (see Paragraph 51 of the Postgesetz of 22 December 1997, BGBl. Part I, p. 3294). (4) - See BGBl. Part II, p. 749. (5) - The first version of the Convention dates from 1874. A provision corresponding to the current Article 25 (see below in the main text) was introduced for the first time in the 1924 Convention (see Article IV of the Final Protocol). As from 1 July 1948, the UPU has been a specialised agency of the UN with the following mission: to oversee the organisation and development of postal services; to promote the development of communication between peoples by means of the effective functioning of these services; to contribute to cooperation in the cultural, social and economic fields and to participate in the provision of technical assistance required by member countries (which currently number 189). The UPU's Constitution (which sets out its general and detailed regulations as well as the Convention itself) is a diplomatic convention subject to ratification by the competent authorities of each member country. The Constitution was adopted by the XV Universal Postal Congress held in Vienna in 1964 and entered into force on 1 January 1966. It was amended by the Congresses of Tokyo (1969), Lausanne (1974), Hamburg (1984), Washington (1989) and Seoul (1994). The version of the Convention applicable to the present cases is that of 1989, the most recent to have been ratified by the Federal Republic of Germany at the material time. Finally, a European Conference of Post and Telecommunications administrations (`CEPT') has been established under the aegis of the UPU. (6) - In the original Italian, the translation is the author's own. (7) - Special Drawing Rights are based on a basket of the major currencies used by the International Monetary Fund. In 1997 one SDR was worth ECU 0.824. (8) - Proceeding IV/32.791 initiated by the Commission (pursuant to Council Regulation No 17 of 6 February 1962, First Regulation implementing Articles 85 and 86 of the Treaty, OJ, English Special Edition 1959-1962, p. 87) following a complaint lodged by the International Express Carrier Conference (IECC), resulted in three separate decisions.  On 17 February 1995 the Commission notified IECC, a body representing the interests of various companies which supply express delivery and remail services, of its final decision rejecting its complaint concerning the application to the CEPT agreement of Article 85 of the EC Treaty (now Article 81 EC) (prohibition of anti-competitive agreements, decisions or connected practices).  By decision of 6 April 1995, the Commission notified IECC of its rejection of the part of the complaint relating to the operation by a number of public postal operators of a system designed to allocate the national postal markets by means of the interception of `physical ABA remail (commercial or non-commercial), non-physical remail and normal cross-border mail' on the basis of Article 23 (now Article 25) of the Convention.  The Commission found that commercial ABA remail, by preventing the receiving public postal operator from recovering its costs of delivering the mail in so far as terminal dues are not based on the real costs of providing the service, amounted to a circumvention of the statutory postal monopoly of the public postal operators and decided that interception of this type of remail, in the specific circumstances, could not be described as constituting an abuse within the meaning of Article 86 of the Treaty. Finally, on 14 August 1995, the Commission adopted a final decision rejecting the part of the complaint by IECC relating to the alleged interception of ABC remail by a number of public postal operators.  Furthermore, by letter of 20 February 1997 (quoted in the written observations submitted to the Court by DP), the Commission notified the public postal operators who were parties to the REIMS I Agreement (see point 8 below) that continuation of the CEPT system of terminal dues or a return to this scheme or to the UPU scheme, which was even less closely linked to the actual costs of delivering incoming international mail, were not feasible options - unless the Commission were to grant negative clearance or individual exemption from the application of Article 85 of the Treaty.  Finally, may I recall that the Court of the First Instance annulled the part of the Commission's decision of 6 April 1995 with respect to IECC (see above) containing the Commission's assessment of the legality of interception of commercial physical ABA remail, in Joined Cases T-133/95 and T-204/95 IECC v Commission [1998] ECR II-3645, point 2 of the operative part and paragraphs 94 to 106 of the grounds). (9) - The final version of this agreement was signed and notified to the Commission in December 1995 under the aforementioned Regulation No 17 for the purpose of obtaining negative clearance or individual exemption (see Commission notice on the notification of an agreement on terminal dues (REIMS) between postal operators, OJ 1996 C 42, p. 7). (10) - Starting from the CEPT rate then in force, this percentage was to increase during the course of the transitional period (lasting five years at most, as from 1 January 1997) to reach ultimately 80% of the domestic tariff, conditional on the pursuit of specific quality-of-service targets.  The mechanism envisaged under the REIMS I Agreement was based on four annual increases in terminal dues by a fixed percentage (15% or 20%) of the current maximum level.  If at the end of the transitional period the level of 80% of the domestic tariff had not yet been reached, the terminal dues would be raised to that level in a single `leap' (see Commission notice cited in footnote 9 above, pp. 7 and 9). (11) - See Commission notice on the renewed notification of an agreement on terminal dues (REIMS II) between postal operators (OJ 1998 C 53, p. 3). (12) - See Commission notice on the notification of an agreement on terminal dues between postal operators (OJ 1998 C 371, p. 7).  The REIMS II Agreement provides for a smoother rise in terminal dues over the transitional period (of four years), thus obviating the need for a very sharp increase on 31 December 2001 in order to bring them up to the stipulated final level of 80% of domestic tariffs (see footnote 10 above).  Starting from the current CEPT rate, the percentage of the domestic tariff was raised to 55% in 1998 and will rise to 65% in 1999 and 70% in 2000. However, as a result of amendments made in 1998, these increases will not take place if the quality of service offered by a PPO falls below standards set in the Agreement.  Whether such deterioration has occurred is determined by comparing the PPO's quality-of-service performance in a given year with the average quality-of-service performance achieved by it in preceding years, beginning with 1997.  As under the REIMS I Agreement, the contracting parties further agreed not to apply Article 25 of the Convention as between themselves following the end of the transitional period. (13) - OJ 1998 L 15, p. 14.  Article 13 further provides that the implementation of these principles may include `transitional arrangements designed to avoid undue disruption on postal markets or unfavourable implications for economic operators provided there is agreement between the operators of origin and receipt; such arrangements shall, however, be restricted to the minimum required to achieve these objectives' (italics added).  Member States were required to have transposed Directive 97/67 by 10 February 1999 at the latest (see Article 24). (14) - See, mutatis mutandis, Case C-251/89 Athanasopoulos and Others [1991] ECR I-2797, paragraph 57; the Commission and the Member State in which the person claiming a benefit supplement is residing are bound by a duty to cooperate in good faith with the institutions of the other Member States which are responsible for ensuring the performance of the obligations arising out of Council Regulation (EEC) No 1408/71 of 14 June 1971 on the application of social security schemes to employed persons, to self-employed persons and to members of their families moving within the Community (OJ, English Special Edition 1971(II), p. 416). (15) - See Agence Europe, No 7316, 7 October 1998, p. 14. (16) - See, inter alia, Case C-260/89 ERT [1991] ECR I-2925, paragraph 34; and Case C-179/90 Merci Convenzionali Porto di Genova [1991] ECR I-5889, paragraph 23. (17) - Case 33/74 Van Binsbergen [1974] ECR 1299, paragraph 13, in which it was decided that a Member State cannot be denied the right to take measures to prevent the exercise by a person providing services from another Member State, whose activity is entirely or principally directed towards the first Member State's territory, of the freedom to provide services for the purpose of avoiding the professional rules of conduct which would be applicable to him if he were established within that State.  In the same case the Court ruled that Article 59 of the Treaty has direct effect. (18) - See my Opinion in Case C-212/97 Centros [1998] ECR I-1459, paragraph 20). (19) - As recipients of a cross-border service (see, mutatis mutandis, Joined Cases 286/82 and 26/83 Luisi and Carbone [1984] ECR 377, paragraph 16). (20) - See, mutatis mutandis, Case 53/81 Levin [1982] ECR 1035, paragraphs 20 to 22, in which it was held that where a worker pursues or wishes to pursue an effective and genuine activity in another Member State and thereby comes within the class of beneficiaries of the rights conferred under Article 48(3) of the EC Treaty (now, after amendment, Article 39(3) EC) and the relevant secondary legislation, the motives which may have prompted him to seek employment in that Member State are of no account and must not be taken into consideration as regards his right to enter and reside in the territory of that State. (21) - See Centros.  The Court implicitly recognised that the position adopted in that case by the Danish administration - which insisted on compliance with Denmark's minimum capital requirements for the formation of a private limited company - was contrary to Community law, predicated as it was on the proposition that Danish nationals carrying on a business directed essentially at the Danish market must have their principal place of business in Denmark.  Having referred to the Van Binsbergen doctrine (see footnote 17 above) the Court went on: `However, although, in such circumstances, the national courts may, case by case, take account - on the basis of objective evidence - of abuse or fraudulent conduct on the part of the persons concerned in order, where appropriate, to deny them the benefit of the provisions of Community law on which they seek to rely, they must nevertheless assess such conduct in the light of the objectives pursued by those provisions.  In the present case, the provisions of national law, application of which the parties concerned have sought to avoid, are rules governing the formation of companies and not rules concerning the carrying on of certain trades, professions or businesses.  The provisions of the Treaty on freedom of establishment are intended specifically to enable companies formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Community to pursue activities in other Member States through an agency, branch or subsidiary. That being so, the fact that a national of a Member State who wishes to set up a company chooses to form it in the Member State whose rules of company law seem to him the least restrictive and to set up branches in other Member States cannot, in itself, constitute an abuse of the right of establishment' (paragraphs 25 to 27; citations omitted; emphasis added).  The Court also made it clear that this interpretation of Articles 52 and 58 of the Treaty does not preclude the authorities of the Member State concerned from adopting any appropriate measure for preventing or penalising fraud, either in relation to the company itself, if need be in cooperation with the Member State in which it was formed, or in relation to its members, where it has been established that they are in fact attempting, by means of the formation of a company, to evade their obligations towards private or public creditors established in the territory of the Member State concerned. (22) - As happens, for example, in cases where a service provider carries on from a Member State a business which is entirely or principally directed towards the territory of his Member State of origin for the purpose of avoiding the professional rules of conduct which would be applicable to him if he were established within that State (see Case C-148/91 Veronica Omroep Organisatie [1993] ECR I-487, paragraphs 9 to 14; and Case C-23/93 TV10 [1994] ECR I-4795, paragraphs 18 to 26, which concern domestic broadcasting organisations established in a Member State other than the Member State to which their broadcasts are directed in order improperly to evade their obligations concerning programme content under the legislation in force in the latter). (23) - See, inter alia, Case 10/61 Commission v Italy [1962] ECR 1, in particular p. 17.  See also Case C-324/93 Evans Medical and Macfarlan Smith [1995] ECR I-563, paragraphs 23, 32 and 33, in which the Court held that Article 234 of the EC Treaty (now, after amendment, Article 307 EC) takes effect only if an international agreement concluded prior to entry into force of the Treaty imposes on a Member State an obligation that is incompatible with the Treaty.  And, consequently, if an international agreement `allows, but does not require, a Member State to adopt a measure which appears to be contrary to Community law, the Member State must refrain from adopting such a measure'.  In any event, it is the settled case-law of the Court that the provisions of an agreement concluded prior to entry into force of the Treaty or prior to a Member State's accession cannot be relied on in intra-Community relations if, as in the present case, the rights of non-member countries are not involved (see Joined Cases C-241/91 P and C-242/91 P RTE and ITP v Commission [1995] ECR I-743, paragraph 84). (24) - See Joined Cases 188/90 to 190/80 France, Italy & the United Kingdom v Commission [1982] ECR 2545, paragraphs 24 to 26, in particular paragraph 25, in which the Court approved the definition of a public undertaking as `any undertaking over which the public authorities may exercise directly or indirectly a dominant influence.  ... such influence is to be presumed when the public authorities directly or indirectly hold the major part of the undertakings's subscribed capital, control the majority of the votes, or can appoint more than half of the members of its administrative, managerial or supervisory body', contained in Article 2 of Commission Directive 80/723/EEC of 25 June 1980 on the transparency of financial relations between Member States and public undertakings (OJ 1980 L 195, p. 35; as amended).  I would recall that, according to the case-law of the Court, the concept of `undertaking', in particular in the context of competition law, includes any entity carrying on an economic activity, irrespective of its legal form and how it is financed. (25) - See footnote 3 above together with the part of the main text to which it refers, and Case C-320/91 Corbeau [1993] ECR I-2533, paragraph 8; a body which has been granted exclusive rights as regards the collection, carriage and delivery of mail must be regarded as an undertaking to which the Member State concerned has granted exclusive rights within the meaning of Article 90(1) of the Treaty. (26) - See, inter alia, ERT (cited in footnote 16 above), paragraph 31. (27) - See, inter alia, Case C-41/90 Höfner and Elser [1991] ECR I-1979, paragraph 29; ERT (cited in footnote 16 above), paragraph 37; Merci Convenzionali Porto di Genova (cited in footnote 16 above), paragraph 17; Case C-323/93 Centre d'Insémination de la Crespelle [1994] ECR I-5077, paragraph 18; Case C-163/96 Raso and Others [1998] ECR I-533, paragraph 27; and Case C-266/96 Corsica Ferries France [1998] ECR I-3949, paragraph 40. (28) - See, intera alia, Case 7/82 GVL v Commission [1983] ECR 483, paragraph 56, in which it was held that a refusal by an undertaking having a de facto monopoly to provide its services for all those who may be in need of them but who do not come within a certain category of persons defined by the undertaking on the basis of nationality or residence is contrary to Article 86 of the Treaty. (29) - See, mutatis mutandis, Case 27/76 United Brands v Commission [1978] ECR 207, paragraphs 233 and 234; and Case T-229/94 Deutsche Bahn v Commission [1997] ECR II-1689, paragraph 78.  See also Case 41/83 Italy v Commission [1985] ECR 873, in which the Court dismissed the Italian Republic's application for the annulment of Commission Decision 82/861/EEC of 10 December 1982 relating to a proceeding against British Telecommunications (`BT'), under Article 86 of the EEC Treaty (OJ 1982 L 360, p. 36), in which the Commission found that BT, which at the time held a statutory monopoly on the management of telecommunications systems, had abused its dominant position by  adopting certain rules in the course of its business activity.  Inter alia, the Decision found unlawful a rule prohibiting subscribers who relayed on behalf of third parties telex messages which originated from, and were intended for delivery in, a country outside the United Kingdom, from applying a scale of charges that would enable the sender to send the message more cheaply than if it had been sent directly.  According to the Commission, this prohibition infringed Article 86 of the Treaty in the following respects: (i) it restricted the activities of message-forwarding agencies to the detriment of their customers operating in other Member States; (ii) it applied dissimilar conditions to equivalent transactions offered by the message-forwarding agencies, in that it made it a condition of continuation of service that those of the messages forwarded to BT which were for re-forwarding to destinations outside the United Kingdom must originate in the United Kingdom or else be priced so as to make it no cheaper for the sender than if he had sent them directly, thus placing the agencies at a competitive disadvantage vis-à-vis the national telecommunications authorities and agencies in other Member States not bound by such rules; and (iii) it subjected the use of telephone and telex services to the acceptance of an obligation, on the part of the agencies, to charge prices which bore no relation to the type and quality of telecommunication services supplied but which were instead dictated by BT's intention to protect the revenues of other national telecommunications authorities. (30) - See Case 322/81 Michelin v Commission [1983] ECR 3461, paragraph 57. (31) - The conclusion which I draw in the main text naturally does not exclude the possibility that the contested measure may be contrary to Article 86 in other respects also.  The Oberlandesgericht has pointed out that the measure appears to allow DP indirectly to impose on the sender prices which are excessive in relation to the economic value of the service supplied (see subparagraph (a) of the second paragraph of Article 86 of the Treaty): the applicant is entitled to claim the full domestic postage notwithstanding the fact that (i) the delivery cost of incoming international mail is presumably less than that of domestic mail, and (ii) the PPO of the Member State of posting has collected the international tariff from the user of the service and passed on to DP the terminal dues provided for under the agreements in force.  The national court also adverted, in doubtful terms, to whether the measure infringed the prohibition of the abuse consisting of limiting technical development to the prejudice of users of the service (see Article 90(1) and subparagraph (b) of the second paragraph of Article 86 of the Treaty).  The provision of services consisting of the physical production of letters with pre-determined content - such as the services offered by the partners of GZS and CKG and which became possible only with the advent of modern information and data processing technology - could cease to be viable if the purchaser of the overall service is forced to pay the domestic tariffs of the country of destination in addition to the international tariffs of the country of posting. (32) - See, inter alia, Case 6/72 Continental Can [1973] ECR 215. (33) - It must be remembered that Article 86 of the Treaty does not require it to be proved that the abusive conduct has in fact appreciably affected trade between Member States.  It is sufficient to constitute a breach of the article if it is reasonably foreseeable on the basis of a set of objective factors of law or fact that the conduct in question may have an influence, direct or indirect, actual or potential, on the pattern of trade between Member States, such as might prejudice the realisation of the aim of a single market in all the Member States (see Michelin (cited in footnote 30 above), paragraph 104; and Case C-250/92 DLG [1994] ECR I-5641, point 4 of the operative part of the judgment). (34) - See, inter alia, Raso (cited in footnote 27 above), paragraph 31. (35) - See Case 7/68 Commission v Italy [1968] ECR 423; Case C-2/90 Commission v Belgium  [1992] ECR I-4331, paragraph 26; and Evans Medical and Macfarlan Smith (cited in footnote 23 above), paragraph 20. (36) - Like, for example, the supply of oil, spare parts and other goods in connection with the technical inspection of vehicles (see Case C-55/93 Van Schaik [1994] ECR I-4837, paragraph 14). (37) - See Case C-275/92 Schindler [1994] ECR I-1039, in which this Court ruled that the lottery activities pursued by the defendants in the main proceedings were not activities relating to `goods' within the meaning and for the purpose of Article 30 et seq. of the Treaty.  The importation and distribution of promotional materials, application forms and tickets on behalf of a lottery operator in another Member State were not ends in themselves, the Court found, but were `specific steps in the organisation or operation of a lottery and [could not], under the Treaty, be considered independently of the lottery to which they relate'.  The Court therefore concluded that the activity pursued by the Schindlers related to a service and fell within the scope of Article 59 of the Treaty (see paragraphs 21 to 30, in particular paragraph 22). (38) - See, inter alia, Case 360/89 Commission v Italy [1992] ECR I-3401, paragraph 11. Elsewhere, the Court has held that the Treaty (Articles 48 and 52 in the case in question) also precludes any national measure which, even though it is applicable without discrimination, is still liable to hamper or to render less attractive the exercise by Community nationals (or companies) of fundamental freedoms guaranteed by Community law (see, inter alia, Case C-19/92 Kraus [1993] ECR I-1663, paragraph 32).  A restrictive measure which is non-discriminatory in nature can be justified, in the absence of Community harmonisation, even by overriding reasons relating to the general interest, provided that the interest in question is not already safeguarded by rules applicable to service providers in their Member State of establishment and that the resulting limitation placed on the freedom enshrined in Article 59 of the Treaty is necessary and proportionate (see, inter alia, Opinion of Advocate General La Pergola delivered on 4 March 1999 in Case C-124/97 Läärä and Others (not yet published), paragraph 31). (39) - See, inter alia, Case 352/85 Bond van Adverteerders and Others [1988] ECR 2085, paragraphs 32 and 33.  Since it constitutes a derogation to a fundamental principle of the Treaty, Article 56 of the Treaty must be strictly construed.  Recourse to it presupposes the existence of a genuine and sufficiently serious threat affecting one of the fundamental interests of society (see, inter alia, Case C-114/97 Commission v Spain [1998] ECR I-6717, paragraph 46).  It follows that the article cannot be invoked for the purpose of pursuing economic aims (see, inter alia, Bond van Adverteerders, cited above, paragraph 34). Furthermore, measures adopted to safeguard the interests in question must be strictly necessary and must comply with the principle of proportionality (see, inter alia, Joined Cases 115/81 and 116/81 Adoui and Cornouaille [1982] ECR 1665, paragraph 9; and Bond van Adverteerders, cited above, paragraph 36). (40) - The national court observed that the cross-border criterion is satisfied in the case of the services supplied by the Danish and Netherlands postal administrations to physical senders of mail to Germany: it is common ground that these postal administrations convey the mail not merely to the border but rather, under their own responsibility and at their own expense, right to the dispatch post offices located within Germany (Hamburg and Oberhausen respectively).  According to the Court's case-law, Article 59 of the Treaty applies not only where a person providing services and the recipient thereof are established in different Member States, but also in all cases where the person providing services offers those services in a Member State other than that in which he is established, wherever the recipients of those services may be established  (see Case C-398/95 SETTG [1997] ECR I-3091, paragraph 8). (41) - As CKG has observed, the fact that CESC, the Netherlands provider of the services at issue in Case C-148/97, is a company belonging to the same group as the defendant does not remove it from the category of beneficiaries of the Treaty rules on freedom to provide services.  Besides, Article 59 of the Treaty also applies to services which a provider supplies to recipients established in other Member States without moving from the Member State in which he is established (see Case C-384/93 Alpine Investments [1995] ECR I-1141, paragraphs 21 and 22). (42) - See, inter alia, Case C-76/90 Säger [1991] ECR I-4221, paragraph 12; and Case C-410/96 Ambry [1998] ECR I-7875, paragraphs 28 and 29. (43) - See Paragraph 2(2)(1) and Paragraph 4(2) of the PTRegG (cited in footnote 3 above). (44) - See Corbeau (cited in footnote 25 above), paragraph 15. (45) - Article 90(2) of the Treaty, the Court recently noted, `seeks to reconcile the Member States' interest in using certain undertakings, in particular in the public sector, as an instrument of economic or fiscal policy with the Community's interest in ensuring compliance with the rules on competition and the preservation of the unity of the common market.  The Member States' interest being so defined, they cannot be precluded, when defining the services of general economic interest which they entrust to certain undertakings, from taking account of objectives pertaining to their national policy or from endeavouring to attain them by means of obligations and constraints which they impose on such undertakings' (see, inter alia, Case C-157/94 Commission v Netherlands [1997] ECR I-5699, paragraphs 39 and 40 (emphasis added).  See also Case C-202/88 France v Commission [1991] ECR I-1223, paragraph 12). (46) - The connection between the first two paragraphs of Article 90 was established by the Court in Corbeau (cited in footnote 25 above), paragraphs 13 and 14.  Accordingly, a State measure contrary to Community law as contained in Article 90(1) of the Treaty may nonetheless be deemed compatible with the Treaty if it satisfies the conditions laid down in Article 90(2) of the Treaty, in particular if it is necessary to ensure the performance of the tasks of general economic interest assigned to the undertaking in question. (47) - See the second recital in the preamble to Directive 97/67 (cited in footnote 13 above). (48) - See Case C-157/94 (cited in footnote 45 above), paragraph 51. (49) - See Corbeau (cited in footnote 25 above), paragraph 16. (50) - See Case C-157/94 (cited in footnote 45 above), paragraph 52. (51) - I would recall that Article 16 EC (introduced as Article 7d by the Treaty of Amsterdam amending the Treaty on European Union, the Treaties establishing the European Communities and Certain Related Acts) provides: `Without prejudice to Articles [77 and 90 of the EC Treaty (now, respectively, Articles 73 and 86 EC) and 92 of the EC Treaty (now, after amendment, Article 87 EC)], and given the place occupied by services of general economic interest in the shared values of the Union as well as their role in promoting social and territorial cohesion, the Community and the Member States, each within their respective powers and within the scope of application of this Treaty, shall take care that such services operate on the basis of principles and conditions which enable them to fulfil their missions'.  The Declaration on Article 7d annexed to the Final Act of the Treaty of Amsterdam further provides that the provisions of that article `shall be implemented with full respect for the jurisprudence of the Court of Justice, inter alia as regards the principles of equality of treatment, quality and continuity of [public] services'. It has been observed that, in the absence of substantive amendments to the Treaty rules on competition, Article 16 EC - which was introduced into the first part of the Treaty, which sets out the principles - is intended to balance Article 3a of the EC Treaty (introduced by the Treaty on European Union and now Article 4 EC), which requires the Member States and the Community to adopt an economic policy conducted in accordance with the principle of an open market economy with free competition (see L. Flynn, Review of Article 90 EC Case-law of the Court of Justice of the European Communities (contribution to the conference on Postal Services, Liberalisation and EC Competition Law, Brussels, 12 June 1998), page 27 of the manuscript). (52) - Under Directive 97/67 (see footnote 13 above), the provision of the universal postal service provision must meet, inter alia, the requirements of offering on a permanent basis an identical and non-discriminatory service under comparable conditions to users at all points in the territory (see Articles 3(1) and 5).  As regards the tariffs for the services forming part of the provision of the universal service, Article 12 of the Directive requires only that these be affordable, such that all users have access to the services provided, geared to costs and non-discriminatory.  And it is only by way of exception to the principle of each tariff being geared to costs that `Member States may decide that a uniform tariff should be applied throughout their national territory'. (53) - Tariff equalisation `consists in fixing the tariffs in terms of the average cost of running the service, thus setting off against one another the surpluses realised on lowest unit cost services (in particular the most heavily used and best inter-connected services) and the deficits borne on the highest unit cost services' (see Opinion of Advocate General Tesauro in Corbeau, cited in footnote 25 above). (54) - See W. Bishop, C. Caffarra, K.-U. Kühn and R. Whish, Liberalising Postal Services: On the Limits of Competition Policy Intervention, London 1998, pp. 16 to 18.  According to the authors, the proper economic measure of the USO burden is the cost which the PPO would save if it were to cease the loss-making operations imposed by the USO, minus the revenue it derives from these services under the uniform tariff.  They also note that the data on the true scale of the USO burden are highly uncertain, given the scarcity of published empirical materials. (55) - The reservation of some services to the operator subject to the USO must, moreover, be limited to the minimum compatible with the requirement of protecting the long-term economic viability of the provision of the universal service (see 16th recital in the preamble to, and Article 7(1) and (2) of, Directive 97/67, cited in footnote 13 above). (56) - See Corbeau (cited in footnote 25 above), paragraphs 17 and 18.  The Court added, moreover, that the exclusion of competition is not justified `as regards specific services dissociable from the service of general interest which meet special needs of economic operators and which call for certain additional services not offered by the traditional postal service, such as collection from the senders' address, greater speed or reliability of distribution or the possibility of changing the destination in the course of transit, in so far as such specific services, by their nature and the conditions in which they are offered, such as the geographical area in which they are provided, do not compromise the economic equilibrium of the service of general economic interest performed by the holder of the exclusive right' (idem, paragraph 19; emphasis added). (57) - Under Directive 97/67 (see footnote 13 above) Member States may now make the granting of licences for the provision of non-reserved postal services subject to universal service obligations or to an obligation to contribute to a fund set up to compensate the universal postal service provider for the provision of services which represent an excessive financial burden (see Article 9(2) and (4)).  The relevant German provisions are contained in Paragraphs 11 to 17 and 52 of the aforementioned Postgesetz of 22 December 1997 (see footnote 3 above).  Provisions such as these mark the abandonment of the principle according to which universal service is funded by cross-subsidy from excess profits generated in the reserved sectors (see J.I. Campbell Jr, Overview of the International Postal Reform Movement, 1998, p. 10 of the manuscript, available at http://www.jcampbell.com/ rowland/jc_98cat.pdf). (58) - DP submitted that, first, the financial losses caused by the obligation to deliver `bogus' incoming international mail would, ultimately, have to be financed by the other users of the postal service, in the form of increases or forgone reductions in postage rates. Secondly, the indications were that in future a growing number of the operators concerned (banks and credit card administration companies in particular) would resort to non-physical remail techniques: a study carried out by a firm of consultants on behalf of DP estimated the likely annual losses at between 3 and 4 billion marks.  Therefore, the applicant argued, the only means by which it could maintain its financial equilibrium was by applying Article 25 of the Convention. (59) - The onus of proof of fulfilment of the conditions required under Article 90(2) of the Treaty includes the criterion of transparency.  In a case concerning the application of Articles 85 and 86 of the Treaty to bilateral or multilateral agreements between airlines regarding airline tariffs applicable to scheduled flights, the Court held that `for it to be possible for the effect of the competition rules to be restricted pursuant to Article 90(2) by needs arising from performance of a task of general interest, the national authorities responsible for the approval of tariffs and the courts to which disputes relating thereto are submitted must be able to determine the exact nature of the needs in question and their impact on the structure of the tariffs applied by the airlines in question.  Indeed, where there is no effective transparency of the tariff structure it is difficult, if not impossible, to assess the influence of the task of general interest on the application of the competition rules in the field of tariffs.  It is for the national court to make the necessary findings of fact in that connection' (see Case 66/86 Ahmed Saeed Flugreisen [1989] ECR 803, paragraphs 56 and 57; emphasis added).  From the case-file in the present case it is not apparent whether the applicant, as the provider of the universal postal service in Germany, keeps transparent and separate accounts within its internal accounting system for each of the services within the reserved sector on the one hand and for the non-reserved services (whether forming part of the universal service or not) on the other, on the basis of consistently applied and objectively justifiable cost accounting principles.  Article 14 of Directive 97/67 (see footnote 13 above) requires Member States, by 10 February 2000, to take the measures necessary to ensure that the universal service providers implement cost accounting systems which can be independently verified and by which costs can be allocated to services as accurately as possible on the basis of transparent procedures. (60) - See Case T-260/94 Air Inter v Commission [1997] ECR II-997, paragraph 139. The applicant in that case relied on Article 90(2) of the Treaty in challenging the application of certain provisions of Council Regulation (EEC) No 2408/92 of 23 July 1992 on access for Community air carriers to intra-Community air routes (OJ 1992 L 240, p. 8), adopted under Article 84 of the EC Treaty (now, after amendment, Article 80 EC). (61) - The requirement to keep separate accounts for reserved and non-reserved services, prescribed by Directive 97/67 (see footnote 52 above), is dictated by the need to prevent cross-subsidies from the reserved sector to the non-reserved sector, which can adversely affect competitive conditions in the latter (see 28th recital). (62) - See N. Emiliou, The principle of proportionality in European Law: a comparative study, London 1996, p. 169, and C. Gydal, The principle of proportionality, Stockholm 1996, pp. 21 and 22. (63) - See Case C-157/94 (cited in footnote 45 above), paragraphs 58 to 63.  In that case, which concerned infringement proceedings brought by the Commission, the Court held that the burden - which lies with the Member State invoking Article 90(2) of the Treaty - of proving that the conditions for the application of that provision are met, cannot be so extensive as to require the Member State concerned - having set out in detail the reasons for which, in the event of elimination of the contested measures, the performance, under economically acceptable conditions, of the tasks of general economic interest which it has entrusted to an undertaking would, in its view, be jeopardised - to go even further and prove, positively, that no other conceivable measure, which by definition would be hypothetical, could enable those tasks to be performed under the same conditions.  The principle thereby established by the Court is linked, moreover, to the specific characteristics of proceedings under Article 169 of the Treaty (now Article 226 EC), under which it is incumbent on the Commission to prove an alleged infringement and to place before the Court the material necessary to enable it to determine the issue. (64) - See, inter alia, Case 6/64 Costa [1964] ECR 585; Case 106/77 Simmenthal [1978] ECR 629, paragraphs 21 and 24; and Joined Cases C-10/97 to C-22/97, IN.CO.GE.'90 and Others [1998] ECR I-6307, paragraph 20. (65) - See, inter alia, Case C-202/88 (cited in footnote 45 above), paragraph 53.