C-261/81

D E SMEDT PVBA, Zemst (Belgium),

on the interpretation of Article 30 of the EEC Treaty,

T H E COURT

composed of: J. Mertens de Wilmars, President, A. O'Keeffe, U. Everling and A. Chloros (Presidents of Chambers), P. Pescatore, Lord Mackenzie Stuart, G. Bosco, T. Koopmans and O. Due, Judges,

Advocate General: G. Reischl Registrar: P. Heim

gives the following

The facts of the case, the course of the exhibited for sale, consigned or delivered procedure and the observations only in the form of cube-shaped blocks submitted by the parties pursuant to having a net weight of 250 g, 500 g, 1 kg Anicie 20 of the Protocol on the Statute or 2 kg and in sealed containers." of the Court of Justice of the EEC may be summarized as follows: According to the Landgericht Hamburg, at the time when the contract was signed I — Facts and written procedure both parties asumed that the abovementioned provision would be The dispute which gave rise to this repealed or would no longer be applied reference for a preliminary ruling following the judgment of the Court of concerns a contract of sale between Justice in the "Cassis de Dijon" case Walter Rau Lebensmittelwerke [herein- (judgment of 20 February 1979 in Case after referred to as "Rau"], a German 120/78 REWE-Zentral AG v Bun- undertaking, and De Smedt PvbA desmonopolverwaltung für Branntwein [hereinafter referred to as "De Smedt"], [1979] ECR 649). The provision in a company incorporated under Belgian question was in fact replaced by Article 8 law. Rau undertook to supply 15 000 kg of the Royal Decree of 2 October 1980 of margarine packed in containers having on the manufacture and marketing of the shape of a truncated cone. As a term margarine and edible fats, which of the contract Rau warranted that the provides as follows: margarine which it supplied could be marketed by virtue of the applicable "It shall be prohibited to sell by retail provisions of the EEC Treaty on the free composite margarine and edible fats movement of goods. which are not completely liquid at 20 ° C where each block or its external At the time when the contract was packaging is not cube-shaped. This concluded, the parties were in agreement provision shall not apply to products that the goods in question were to be having a net weight of less than 50 g or imported into Belgium and thus accepted more than 2 kg." and paid for only if the relevant provisions of Belgian law relating to De Smedt, the defendant in the main margarine permitted the importation and proceedings, inquired of the Belgian marketing of margarine in containers Ministry of Health whether it could having the shape of a truncated one. impon the margarine which it had At the time when the contract was purchased. concluded, the relevant Belgian provision on the packaging of margarine was By letter of 6 November 1980, the Anicie 15 of the Law of 8 July 1935, Belgian Ministry informed De Smedt which provided as follows: that legislative provisions still existed which prohibited the sale of margarine "Margarine and prepared fats may be where its external packaging was not imponed, held in stock or transponed cube-shaped. Following the receipt of for the purpose of sale or delivery, that letter, De Smedt informed Rau that

The order making the reference was The Landgericht considered that even received at the Court Registry on 25 though the Belgian provision did not prevent the importation of margarine September 1981. whose packaging was not cube-shaped, it might make more difficult the marketing Pursuant to Article 20 of the Protocol on of margarine lawfully packed in such the Sutute of the Court of Justice of containers in another Member Sute, in the EEC, written observations were particular in the case of parallel imports. submitted by Rau, represented by However, it was possible that such a J. Gündisch, Rechtsanwalt, Hamburg, provision might fall within the exceptions De Smedt, represented by D. C. Ohlgart, contained in Article 36 of the EEC Rechtsanwalt, Hamburg, the Com- Treaty. mission, represented by its Legal Adviser, Rolf Wägenbaur, and by the Belgian The marketing of margarine in tubs is Government, represented by Pierre permitted in the Federal Republic of Legros of the Brussels Bar. Germany by Article 2 (1) of the Gesetz über Margarine, Halbfettmargarine and Upon hearing the report of the Judge- Kunstspeisefett [Law on margarine, Rapporteur and the views of the half-fat margarine and artificial edible Advocate General, the Court decided to fats] of 1 July 1975 (Bundesgesetzblatt I, open the oral procedure without any p. 1841), which provides as follows: preparatory inquiry.

"Packs or containers must have a square base or be in the form of a truncated cone. Packs or containers having a II — Summary of the obser- weight of at least 1 000 g may also take vations submitted to the the form of a parallelepiped." Court

law permits the packaging of margarine margarine in the Netherlands and in in tubs and that that form of packaging Belgium. has been in general use in Germany for the last twenty-five years since it offers certain advantages by comparison with Rau maintains that in 1975 it developed grease-proof paper. Margarine manufac- a new form of packaging. Two tubs of turers have brought their production into margarine were packed in a box exactly line with that development. In particular, cubic in shape.

permitted. In France the cubic form is action and the case (Case 177/80) was prescribed but exceptions are permitted removed from the Court's register. in the case of supplies to the processing industries and of exports. In Rau's view, the obstacle to the free The Belgian provision in question forms movement of goods created by the an appreciable obstacle to the import- Belgian provisions on the packaging .and ation of margarine into Belgium from form of blocks of margarine is not nearly all the Member States of the justified by the need to safeguard one of European Community, in particular from the objectives granted legal protection the Federal Republic of Germany.

In support of that view with the Belgian provisions, which would the plaintiff cites the judgments of the be extremely costly. That is why there Court of Justice in the "Cassis de Dijon " is virtually no Community trade in case cited above, in Case 130/80 margarine between the Federal Republic Criminal Proceedings against Fabriek of Germany and Belgium in spite of voor Hoogwaardige Voedingsprodukten the fact that prices of margarine in Kelderman [1981] ECR 527 and in Case Belgium are appreciably higher than in 788/79 Criminal Proceedings against neighbouring States in which margarine Herben Gilli and Paul Andres [1980] is also produced and consumed in sub- ECR 2071 and refers to the communi- stantial quantities. cation from the Commission concerning the consequences of the judgment in the In Annex 3 to its observations, Rau "Cassis de Dijon " case (Official Journal 1980, C 256, p. 2).

JUDGMENT OF 10. 11. 1982 — CASE 261/81

Rau proposes that the following answer by requirements relating to consumer be given: protection and fair trading.

In this case, the description "margarine", Even if Article 8 of the Royal Decree which the consumer may easily fail to were to be considered as equivalent to an notice, cannot be considered as indirect quantitative restriction on equivalent, in terms of information, as imports, it would nevertheless be justified the distinctive cubic form of packaging.

RAU v DE SMEDT

De Smedt proposes that the reply which containers in which the goods are should be given is that Article 8 of the marketed must bear the word Belgian Royal Decree of 2 October 1980 "margarine" in a conspicuous position in on the manufacture and marketing of clearly visible and easily readable letters. margarine and edible fats is not contrary to Article 30 of the EEC Treaty.

JUDGMENT OF 10. 11. 1982 — CASE 261/81

actual principle of a compulsory shape is In the alternative, the Belgian Govern- not called in question, it should be ment maintains that Article 8 of the observed that, according to the case-law Royal Decree does not constitute a of the Court, in the absence of the measure having an equivalent effect harmonization of the laws of the various within the meaning of Article 30 of the States on this matter, it is for each Treaty. In contrast to the "Cassis de Member State to lay down, in respect of Dijon" case and Case 148/78 Pubblico its own territory, the most appropriate Ministero v Tullio Ratti [1979] ECR shape for the sale of the products. 1629, it is not completely impossible to market products which do not comply with the legal provisions, in so far as it is merely necessary to adopt the external presentation of the product in order to The Belgian Government explains the market it. history of the Belgian legislation on margarine since the Law of 4 May 1900.

RAU v DE SMEDT

The public has grown accustomed to In the alternative, it should give the distinguishing the two products when following reply to the question raised: offered for retail sale solely by visual means, in the sense that anything which "Anicie 8 of the Royal Decree of does not appear cubic in shape must be 2 October 1980 on the manufacture and butter. The repeal of the requirement in marketing of margarine and edible fats, question would give certain unscrupulous which prohibits the marketing of manufacturers the opportunity to place a margarine or edible fats where each margarine on the market in non-cubic block or its external packaging is not form in the speculative hope of taking cube-shaped, does not constitute a unfair advantage of the conditioned measure having an effect equivalent to a reflex of the consumer who, mistakenly quantitative restriction prohibited by believing that he was getting butter, Article 30 of the Treaty establishing the would in fact be getting margarine. European Economic Community." In the absence of harmonization at European level, since the Belgian legislation has relaxed the provisions relating to labelling, it is important to Ill — Oral procedure maintain the visual distinction and in particular the cubic shape, which for At the hearing on 15 June 1982 oral consumers has been synonymous with argument was presented by the margarine for 80 years. following: Dr Jürgen Gündisch, for Rau: Dr Dietrich Ohlgart, for De Smedt; In reply to a written question put to it by Pierre Legros, for the Belgian the Court, the Belgian Government Government; and R. Wägenbaur, for informed the Court that the proportion the Commission of the European of butter sold in Belgium in plastic Communities. containers was in the order of 8 %. In the vast majority of cases, this butter is The Belgian Government produced a presented to consumers in a plastic photograph of a truncated-cone-shaped packaging in parallelepipedal form. packaging for butter and Rau produced a selection of forms of packaging for The Belgian Government proposes butter and margarine. primarily that the Court should declare the reference for a preliminary ruling to The Advocate General delivered his be inadmissible. opinion on 21 September 1982.

4 After being informed by the competent authorities that the marketing of margarine packed in tubs having the shape of a truncated cone was still prohibited the defendant company in the main action refused to accept deliveries under the contract. The plaintiff did not accept its refusal and sued the defendant before the Landgericht Hamburg.

5 The defendant contended before that court that the Belgian Royal Decree under which margarine may be marketed only in cube-shaped packaging was not contrary to Article 30 of the EEC Treaty for the reason that Belgium could properly adopt that decree because it was necessary to distinguish correctly between butter and margarine sold by retail. The defendant therefore considered that it was not under the duty to fulfil the obligations which it had under the contract with the plaintiff to accept and pay for the margarine which it ordered.

RAU v DE SMEDT

6 The Landgericht Hamburg does not exclude the possibility that the Belgian rules, which apply only to the retail trade, may conceal a measure having an effect equivalent to a quantitative restriction on imports. It considers that such rules may make it more difficult to market margarine lawfully packed in another Member State in containers having the shape of a truncated cone.

7 So by its order of 16 September 1981 the Landgericht Hamburg stayed the proceedings and submitted the following question to the Court:

"Is there a prohibited measure having an effect equivalent to a quantitative restriction on imports within the meaning of Article 30 of the Treaty establishing the European Economic Community if it is prohibited, as in Article 8 of the Belgian Royal Decree of 2 October 1980 on the manufacture and marketing of margarine and edible fats, to market margarine or edible fats if each block or its external packaging is not cube-shaped and because of that prohibition margarine packaged in a different shape in another Member State in accordance with the provisions of that State has to be specially packaged in cube-form in order for it to be imported into the Kingdom of Belgium?"

1 1 The defendant in the main action and the Belgian Government maintain that the Belgian Royal Decree may not be classified as a measure equivalent to a quantitative restriction. The previous judgments of the Court concerned only a prohibition .against the importation and marketing of products arising from national legislation on product quality, which was not the case in this instance because it was sufficient to adapt the presentation of the product in order to market it. Furthermore the form of packaging does not constitute a real obstacle to trade. In any case, even if sale by retail were prohibited, there are alternative possibilities such as the wholesale trade.

12 In this regard it must be recalled, as the Court has repeatedly held since its judgment of 20 February 1979 in Case 120/78 REWE [1979] ECR 649, that in the absence of common rules relating to the marketing of the products concerned, obstacles to free movement within the Community resulting from disparities between the national laws must be accepted in so far as such rules, applicable to domestic and to imported products without distinction, may be recognized as being necessary in order to satisfy mandatory requirements relating inter alia to consumer protection. It is also necessary for such rules to be proportionate to the aim in view. If a Member State has a choice between various measures to attain the same objective it should choose the means which least restricts the free movement of goods.

1 3 Although the requirement that a particular form of packaging must also be used for imported products is not an absolute barrier to the importation into the Member State concerned of products originating in other Member States,

18 At the hearing the representative of the Belgian Government also argued that Belgium is bound by Anicie 11 (2) of Council Directive 79/112/EEC of

JUDGMENT OF 10. 11. 1982 — CASE 261/81

18 December 1978 on the approximation of the laws of the Member States relating to the labelling, presentation and advertising of foodstuffs for sale to the ultimate consumer (Official Journal 1979, L 33). He contended that that provision of Community law governs the way in which a pack of margarine or butter may be marked and prevents the Belgian Government from pres- cribing sufficiently large markings to warn the public of a change affecting its habits.

19 The article in question provides that the particulars which must appear on the packaging must "be easy to understand and marked in a conspicuous place in such a way as to be easily visible, clearly legible and indelible". That provision authorizes and requires the Member States to adopt the measures necessary to inform the consumer while leaving them considerable scope for the exercise of discretion. It by no means prevents the Belgian Government from adopting appropriate rules as to labelling applicable in a uniform manner to margarine produced in Belgium and in other Member Sutes.

20 The reply to the question submitted to the Court should therefore be that the application in one Member State to margarine imported from another Member State and lawfully produced and marketed in that State of legislation prohibiting the marketing of margarine or edible fats where each block or its external packaging does not have a particular shape, for example the shape of a cube, in circumstances in which the consumer may be protected and informed by means which hinder the free movement of goods to a lesser degree constitutes a measure having an effect equivalent to a quantitative restriction within the meaning of Article 30 of the EEC Treaty.

The application in one Member State to margarine imported from another Member Sute and lawfully produced and marketed in that Sute of legislation prohibiting the marketing of margarine or edible fats where each block or its external packaging does not have a particular shape, for example the shape of a cube, in circumstances in which the consumer may be protected and informed by means which hinder the free movement of goods to a lesser degree constitutes a measure having an effect equivalent to a quantiutive restriction within the meaning of Article 30 of the Treaty.

Menens de Wilmars O'Keeffe Everling Chloros

Pescatore Mackenzie Stuart Bosco Koopmans Due

Delivered in open court in Luxembourg on 10 November 1982.

P. Heim J. Mertens de Wilmars Registrar President