Horizontal direct effect of article 34 TFEU?

In her recent Opinion in case C-171/11 Fra.bo SpA v. Deutsche Vereinigung des Gas- und Wasserfaches eV (DVGW), Advocate General Trstenjak has broken a lance for horizontal direct effect of article 34 TFEU. Until now, the Court has always denied horizontal direct effect of the free movement of goods provisions, in contrast to the other fundamental freedoms.

In her reasoning she uses the analogy of the application of horizontal direct effect to justify the extension of the free movement of goods rules to apply to private persons. The case concerned the refusal by a German private organisation DVGW to certify the brass sockets produced by the Italian company Fra.bo. If certified by DVGW, German legislation would presume that the brass sockets were in conformity with its legislation and usable in German water supply.

Instead of interpreting the concept of public body in such a broad way as to include DVGW, the Advocate General choose to apply the Bosman,Viking and Laval cases by analogy, arguing that “rules of any other nature aimed at regulating in a collective manner gainful employment, self-employment and the provision of services” should also be extended to the case at hand and the free movement of goods.

This was so because DVGW had, in fact, legislative cometence:

 42.      Compte tenu de cette compétence de fait dont disposent DVGW et sa filiale à 100 % pour déterminer quels produits pour le montage, l’extension, la modification ou l’entretien d’installations d’eau potable situées après le point de raccordement du bâtiment ont des chances de se vendre sur le marché allemand et, donc, peuvent être commercialisés, leur activité de normalisation et de certification ne peut pas être exclue du champ d’application de la libre circulation des marchandises.

She justifies her approach, not surprisingly for EU lawyers, on grounds of effectiveness and uniform application of EU law (paras 46 to 48). After that she concludes that the certification requirements set by DVGW amount to a measure of equivalent effect to quantitative restrictions. More surprising are her arguments on whether DVGW can rely on justifications. Similar to the Court’s approach she has no difficulty in stating that private bodies can rely on public interest justifications. She does not even question if private bodies can actually legitimately represent public interests, just like the Court in other cases steps over this hurdle without any difficulty. She then states that in addition to public interests a private body like DVGW can also rely on special reasons of private interest and on fundamental rights:

 56.      Si DVGW n’était pas en mesure de prouver l’existence de l’un des motifs de justification non écrits reconnus par la jurisprudence, il pourrait essayer de faire valoir des raisons spécifique relevant d’un intérêt privé en mettant en avant son caractère d’organisme de droit privé (35). En invoquant l’arrêt Angonese, DVGW pourrait peut-être aussi avancer des «considérations objectives» pour justifier la limitation en cause (36). De surcroît, DVGW pourrait, en faisant valoir son caractère d’organisme de droit privé, invoquer la protection des droits consacrés par la charte des droits fondamentaux de l’Union européenne (37), par exemple la liberté d’entreprise consacrée à l’article 16, et essayer de démontrer l’existence d’un conflit entre la libre circulation des marchandises et un ou plusieurs droits fondamentaux qu’il convient de résoudre équitablement sur le fondement du principe de proportionnalité (38).

Practically speaking, the fact that private certification organisations fall under the scope of article 34 TFEU can have a pretty major impact as well.

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